IRDA has imposed a fine of Rs.40 lakh on Aegon Religare Life Insurance for violation of various distribution norms like soliciting business with unauthorized agents, luring employees of broking firms with gifts/rewards, making additional payouts to its corporate agents for advertisement and sharing data base of prospects with its group company. The insurance regulator has examined 24 such violations of Aegon Religare.
In its order, IRDA said that it has found several instances of forged solicitation in which the insurance company sourced business through unauthorized or non-licensed persons/entities. In fact, in some cases, the regulator found that the policies were issued without authorized signatory (agent’s signature).
Meanwhile, the insurance regulator has found that the company had lured employees of insurance brokerage firms and agents with gifts and rewards. This payout was over and above the commission. In one such instance, the insurer had paid rewards of Rs. 2.2 crore to the employees of the corporate agent ‘V Care Life’.
In addition, the regulator observed that the insurer had remunerated few of its corporate agents for carrying out marketing activities. Last year, few companies like Max Life, Bajaj Allianz and Future Generali were penalized for a similar offense.
Also, IRDA found that the insurer had made substantial payout to its group company called Religare Macquarie Wealth Management for database sharing of prospects. Surprisingly, the insurer had made huge payouts to the company even without reporting to the regulator.
IRDA has asked Aegon Religare to pay the penalty money before October 2.