Insurance sector watchdog IRDA today has imposed a fine of Rs 5 lakh on Bajaj Allianz Life Insurance for violating regulations pertaining to group unit-linked policies.
"By taking it into account of the seriousness of the violation a penalty of Rs 5 lakh is imposed on the insurer under section 102(b) of the Insurance Act, 1938," Insurance Regulatory and Development Authority (IRDA) said in an order.
The penalty should be paid within 15 days from the date of receipt of the order, it said.
The regulator has found Bajaj Allianz Life Insurance guilty of enrolling new members into existing group schemes, where master policy was issued prior to September 1, 2010 without revising the existing scheme as required by circular issued by October 27, 2010.
The insurer enrolled new members into the existing group scheme (Bajaj Allianz Life Group Unit Gain-a ULIP Group Insurance Plan) issued to YES Bank, even after fresh circular on ULIPs was issued, it said.
However, the company in its submission to the regulator said "that by its actions (by keeping in mind the spirit of the circular), has complied with the directions as given in the aforesaid circular on a prospective basis and have not offered any product for sale in contravention of the circular from September 1, 2010".
