New Delhi: Insurance sector regulator IRDA Wednesday slapped a fine of Rs 12 lakh on Sahara Life Insurance Company promoted by Subrata Roy-led Sahara Group for violation of various regulations, including delay in death claim settlement.
"Accordingly, in exercise of the powers conferred upon me under the provisions of the Insurance Act, 1938, I hereby direct the insurer to remit the penalty of Rs 12 lakh," IRDA Chairman J Hari Narayan said in an order against insurer.
The company, set up in 2004, has been directed to pay the fine within a period of 15 days from the date of receipt of the order, it said.
The Insurance Regulatory and Development Authority (IRDA) observed that the insurer allowed unlicensed entities to solicit business through dummy codes and paid commission to such entities.
"Taking into account, 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," IRDA said in the order.
Besides, Sahara Group promoted life insurance company also allowed ineligible person to act as specified person, the order observed.
The insurance regulator also found Sahara Life guilty of licensing ineligible entities as corporate agent.
In its order the regulator said, "it is observed that the corporate agent D K Associates has solicited business through unlicensed persons as evident from the six sample proposal forms obtained during the course of inspection."