Group of firms includes SBI General Insurance Company that has been fined ₹25 lakh.
Insurance regulator Irdai has imposed a penalty of ₹51 lakh on four insurers, including SBI General Insurance Company, for violation of certain norms related to motor insurance.
A penalty of ₹25 lakh has been imposed on SBI General Insurance Company for not fulfilling regulatory obligations under the Motor Third Party (MTP) business.
The Insurance Regulatory and Development Authority of India (Irdai) has also imposed a penalty of ₹13 lakh on Liberty General Insurance Limited, ₹10 lakh penalty on Bajaj Allianz General Insurance Company, and ₹3 lakh on Royal Sundaram General Insurance Company.
In the order on SBI General Insurance Company, Irdai said the charge was that the the insurer did not comply with the MTP Obligation for the financial year 2017-18 calculated as per Regulation 3 of the Irdai (Obligation of Insurer in respect of Motor Third Party Insurance Business) Regulations, 2015.
“For the financial year 2017-18, the insurer did not fulfill the obligation and had a shortfall of ₹104.6 crores (24.08%), which amounts to non-compliance of Regulation 3 of Irdai (Obligation of Insurer in respect of Motor Third Party Insurance Business) Regulations, 2015,” the order said.
It further said the insurer had not fulfilled the MTP obligations during the immediate previous financial year 2016-17 with a significant shortfall of ₹146 crores (38.59%).
“Taking into consideration the repetitive nature of violation, magnitude of violation, and the submissions of the insurer that they are committed and are entering into various tie-ups to fulfill the MTP obligation, the Authority…hereby imposes a penalty of ₹25 lakh,” the order said.
As per the order on Liberty General Insurance Limited, the penalty of ₹13 lakh has been imposed for violation of certain provisions of Guidelines on Motor Insurance Service Provider (MISP Guidelines). The insurer was also directed to ensure in future that any engagement with automotive dealers is strictly in compliance with MISP Guidelines.
The penalty of ₹10 lakh has been imposed on Bajaj Allianz General Insurance Company for violation of certain provisions of Insurance Act, 1938.
In case of Royal Sundaram General Insurance, Irdai order said the insurer was in violation of a provision MISP Guidelines while imposing the penalty of ₹3 lakh.