Irdai penalizes Max Life for governance violations
Irdai: The Insurance Regulatory and Development Authority of India (IRDAI) is a regulatory body under the jurisdiction of the Ministry of Finance, Government of India, and is tasking with regulating and promoting insurance and promoting insurance in India. It is constituting by the Insurance Regulatory and Development Authority Act, 1999.
The prime minister of India announced an insurance repository system, helping policyholders buy and maintain insurance policies in electronic form rather than on paper. Insurance repositories, like share depositories or mutual fund transfer agencies. It will hold electronic records of insurance policies issued to individuals as electronic IDIOTIC or e-policies.
While the Insurance Regulatory and Development Authority of India (Irdai) has penalized Max Life Insurance for violating corporate governance and disclosure rules. The regulator has said that the company did not disclose the related party. Transactions with Analjt Singh group companies such as Max Skill First Ltd.
On the other side, Max Life did not disclose the details of payments made to Max Skill First in the half-yearly. Moreover, outsourcing returns filed with the Authority for the financial years 2015-16 and 2016-17 in violation years 2015-16. And 2016-17 in violation of Clause 11.2 of IRDA Outsourcing Guidelines, 2011, said Irdai.
Max Life had paid a fixed monthly rate for training services to Max Skill First. Irrespective of the number of training sessions. While the regulator further said, “it is observing that the operational data of count of trainers. Mentioning in invoice summary for the year 2016-17 was found to be inconsistent with amounts invoicing.
Certain individuals are employing as trainers were neither employees of Max Skill First nor in the list of retainers. All this has been done without ensuring meaningful cost-benefit analysis. Max Life could appeal against the nominal penalty of Rs. 3 lakh.
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