IRDAI Imposes Penalty on Policybazaar of Rs 1.11 Crore For Violating Insurance Norms
The IRDAI has imposed a Rs 1.11 crore penalty on web aggregator Policybazaar for violation of regulations, after it entered into a partnership with a non-insurance entity called 'Indian Health Organization by Aetna' (IHO) and for this, it offered incentives to its customers in violation of regulations.
Mumbai, August 28: The Insurance Regulatory and Development Authority of India (IRDAI) has imposed a Rs 1.11 crore penalty on web aggregator Policybazaar for violation of regulations. The insurance regulator stated that Policybazaar entered into a partnership with a non-insurance entity called 'Indian Health Organization by Aetna' (IHO), where it offered incentives to its customers in violation of regulations. Narendra Modi Cabinet Approves Liberalisation of FDI Norms to Boost Indian Economy, Allows 100% FDI in Coal Mining and 26% in Digital Media
According to the IRDAI, web aggregators are not allowed to advertise products and services of other entities on their website. But, Policybazaar displayed the services offered by IHO on its website. Also, Policybazaar offered incentives which include complimentary wellness benefits for all new eligible customers. Through this, Policybazaar use to covered five OPD consultations, unlimited telemedicine consultations, unlimited second opinion services, as well as pharmacy discounts.
Informing more about the penalty, IRDAI said, as MoneyControl quoted, "As the leader in the online web aggregation space, Policybazaar is a web aggregator which other web aggregators and online distributors seek to become. This places tremendous responsibility on Policybazaar. In light of such expectations, Policybazaar was expected to act diligently and with utmost care and responsibility. Unfortunately, Policybazaar failed in complying with the Regulations."
Earlier, the web aggregator removed the advertisement on televisions in which it used to offer a 60 percent discount on the motor insurance policy. This, according to IRDAI, leads towards promoting the products of particular insurers. With penalty imposed, Policybazaar will be free to file an appeal with the Securities Appellate Tribunal against this order.
(The above story first appeared on LatestLY on Aug 28, 2019 09:05 PM IST. For more news and updates on politics, world, sports, entertainment and lifestyle, log on to our website latestly.com).