SBI Life Insurance fined Rs 4 lakh by IRDAI for violating norms on protection of policyholders

It was found that provisions prior to the Insurance Laws (Amendment) Act, 2015, were incorporated instead of new provisions.

Published: 28th October 2019 05:29 PM  |   Last Updated: 28th October 2019 05:29 PM   |  A+A-


IRDAI. (Screengrab)


NEW DELHI: Insurance sector regulator IRDAI has imposed a fine of Rs 4 lakh on SBI Life Insurance Company Ltd for violating norms on advertisement and protection of policyholders' interest.

The Insurance Regulatory and Development Authority of India (IRDAI) said it had examined samples of proposal forms signed on November 30, 2016; December 23, 2016; February 17, 2017; and March 23, 2017.

It was found that provisions prior to the Insurance Laws (Amendment) Act, 2015, were incorporated instead of new provisions.

Besides, the provisions of Section 45 of Insurance Act, 1938, which deals with advertisement and disclosure norms were not properly reflected, the regulator said.

IRDAI said the dates on which the samples were examined almost two years after the promulgation of Insurance Laws (Amendment) Act, 2015, which indicated a casual approach of the life insurer in adhering to the regulatory norms.

"A proposal form is a basis of the contract and the provisions of the referred sections of Insurance Act, 1938, should be clearly and correctly mentioned.

The lapses on the part of the life insurer not only violate the provisions of regulations but also indicate lack of proper internal controls in usage of applications for insurance, which may jeopardize the interests of the prospects/insureds," IRDAI said in its order.

Hence, the authority as per the powers vested in it under Section 102(b) of the Insurance Act, 1938, a penalty of Rs 4 lakh (Rs 1 lakh for lapse noticed in each of the four proposal forms) is imposed on the life insurer," it said.

It also directed the life insurer to ensure non-recurrence of such lapses.


Disclaimer : We respect your thoughts and views! But we need to be judicious while moderating your comments. All the comments will be moderated by the editorial. Abstain from posting comments that are obscene, defamatory or inflammatory, and do not indulge in personal attacks. Try to avoid outside hyperlinks inside the comment. Help us delete comments that do not follow these guidelines.

The views expressed in comments published on are those of the comment writers alone. They do not represent the views or opinions of or its staff, nor do they represent the views or opinions of The New Indian Express Group, or any entity of, or affiliated with, The New Indian Express Group. reserves the right to take any or all comments down at any time.

flipboard facebook twitter whatsapp