IRDAI has imposed fine of Rs. 35 lakh on Future Generali India Insurance for violating norms like unreported payments to intermediaries, not giving a clear picture of employed insurance agents and soliciting business from agents with expired licenses, among other violations.
Of the total Rs. 35 lakh, Rs. 10 lakh was imposed for soliciting business from unlicensed entities/agents and agents whose licenses had expired. Also, the regulator found that they did not provide a clear picture of insurance agents engaged by them.
Further, IRDAI found that the company delegated the unlicensed individuals and entities the power to collect premium, allow discount on files premium and accept the risk by issuing cover notes. The regulator imposed a penalty of Rs. 5 lakh for this violation.
Future Generali India Insurance tied up with Future Group to get access to the mall customers when IRDAI rules clearly mention that no insurer should distribute products through any person who is not licensed.
Apart from this, the company paid fees/remuneration more than once during the tenure of the referral arrangement for database converted into sales. For these violations, a penalty of Rs. 5 lakh was imposed on the company.
The company was further fined for deviating from the discount structure approved by the authority and for offering critical illness cover to clients of one master policy under group health policy. These terms and conditions are not as per IRDAI file & use procedure, said the insurance regulator.
IRDAI has asked the company to confirm compliance to this order by 30 May 2016.