Money & Banking

IRDAI imposes ₹1-cr penalty on Cholamandalam

Our Bureau Hyderabad | Updated on October 23, 2019 Published on October 22, 2019

 

 

The Insurance Regulatory and Development Authority of India (IRDA) has imposed a penalty of ₹1.01 crore on Cholamandalam MS GIC Ltd. The penalty has been imposed on the basis of irregularities found in an on-site inspection conducted by the insurance regulator between March 14 and 24, 2017, said Subhash C Khuntia, Chairman, IRDAI, in order issued on Tuesday.

The penalty was imposed after examination of many charges, including the violation of outsourcing norms, violations of norms in paying commissions, and non-compliance to regulations up to November 2018 even after the matter was brought to the notice of the insurer, among others. “There was lack of internal control and audit mechanism in the insurer’s office in identifying system errors, gaps in efficient functioning, not acting on system gaps even after bringing such gaps to its notice, and giving incorrect information to the authority,” the regulator said in his order.

The penalty should be paid within 15 days. “If the general insurer feels aggrieved by this order, an appeal may be preferred to the Securities Appellate Tribunal as per the provisions of the Section 110 of the Insurance Act, 1938, the order added.

Published on October 22, 2019
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