SKS Microfinance Ltd has collected over 100 per cent higher premium than what is permitted from the clients, according to the Insurance Regulatory and Development Authority (IRDA).
“In the group insurance policies, they charged higher premium without informing the clients what is the actual premium. If the premium to be collected is Rs one, they had charged Rs 2,’’ J. Hari Narayan, Chairman, IRDA, told Business Line here today.
“As per our rules, it is illegal,’’ the IRDA chief said adding that a final order on the violation of rules will be issued soon to SKS Microfinance.
The regulator had conducted on-site inspections at the offices of the Hyderabad-based MFI last year and the investigation is on since then.
Generally, investigations into violations are a long process at IRDA involving inspections/raids, seeking explanations and a personal hearing by the Chairman.
SKS Microfinance deals with a number of life and non-life insurers for distribution of products and earns a good chunk as non-core income.