Irdai slaps Rs 5 lakh fine on New India Assurance

Insurance sector regulator Irdai has imposed a penalty of Rs 5 lakh on New India Assurance Company for violating mediclaim policy guidelines.
Pressing its charge that New India Assurance was not in compliance with the Health Insurance Regulations, 2013, Irdai said the company did not mention 'Mediclaim Policy 1996' in its list of products, submitted to the regulator, that were withdrawn.
"The insurer has submitted a list containing deemed withdrawn product along with other products...Vide letter dated 27 May, 2014 and in no list the name of 'Mediclaim Policy 1996' was specified.
"Non submission of the said product in any of the categories mentioned and renewing the policies is non compliance with the provision of Regulation 4(a) of Health Insurance Regulations, 2013," Irdai said.

By not filing the said product in the manner in which it is envisaged to be filed and by renewing the policies without getting clearance from the Authority, the Insurer has violated Regulation, the Insurance Regulatory and Development Authority (Irdai) said.
"Therefore, under the powers...The Authority levies a penalty of Rs 5,00,000 on the insurer. The insurer is directed to ensure compliance to all the provisions of the regulations notified by the Authority," it said in the order.

Irdai said the penalty amount of Rs 5 lakh should be remitted within a period of 15 days from the date of receipt of this order.

Besides, it said the company did not get prior approval of the Authority for renewal of the Mediclaim Insurance Policy 1996 and warned it to desist from doing so.
"Therefore, renewing a policy of the product for which no prior approval of the Authority is obtained is in deviation of Regulation of IRDA (Health Insurance) Regulations 2013 The Insurer is warned for this deviation", it said in the order.
Mumbai headquartered New India Assurance is one of the five wholly government-owned general insurance companies of India.