IRDAI has recently imposed a monetary penalty of Rs. 51 lakh on 4 insurers, including SBI General Insurance, for violation of norms related to motor insurance. A fine of Rs. 25 lakh has been imposed on SBI General Insurance Company for not fulfilling regulatory obligations under the Motor Third Party (MTP) business.
In the order on SBI General Insurance Company, IRDAI said the charge was that the insurer did not comply with the MTP Obligation for the financial year 2017-18 calculated as per Regulation 3 of the IRDAI (Obligation of Insurer in respect of Motor Third Party Insurance Business) Regulations, 2015.
The order said, “For the financial year 2017-18, the insurer did not fulfill the obligation and had a shortfall of Rs. 104.6 crores (24.08%), which amounts to non-compliance of Regulation 3 of IRDAI (Obligation of Insurer in respect of Motor Third Party Insurance Business) Regulations, 2015.”
It further said that the insurer had not fulfilled the MTP obligations during the immediate previous financial year 2016-17 with a significant shortfall of Rs. 146 crore (38.59%).
“Taking into consideration the repetitive nature of violation, magnitude of violation, and the submissions of the insurer that they are committed and are entering into various tie-ups to fulfill the MTP obligation, the Authority… hereby imposes a penalty of Rs. 25 lakh,” the order added.