4 days ago
Why insurance regulator fined Policybazaar Rs 5 crore? All you need to know
The Insurance Regulatory and Development Authority of India (IRDAI) has imposed a Rs 5 crore penalty on Policybazaar Insurance Brokers Pvt Ltd for violating multiple provisions under the Insurance Act, 1938, and the IRDAI (Insurance Web Aggregators) Regulations, 2017. The regulator has also issued a direction, advisory, and caution to the to IRDAI's official order dated August 4, 2025, the violations span 11 separate charges, ranging from governance lapses to improper product promotion practices. The infractions occurred during the period when Policybazaar operated as an Insurance Web Aggregator (IWA), before it obtained a composite broker licence in February the key breaches cited was the display of product rankings on the Policybazaar platform without disclosing adequate material to enable prospective buyers to make informed choices.
The IRDAI noted that various insurance products were promoted as 'top' or 'best' in a manner that appeared biased and lacked its inspection from June 1 to 5, 2020, the IRDAI observed that the top five ULIP products promoted on the website included Bajaj Allianz Goal Assure, Edelweiss Tokyo Wealth Gain+, HDFC Click2Wealth, SBI Life e-Wealth Insurance, and ICICI Signature. The regulator flagged the absence of transparent criteria or disclaimers behind the display of such order also points to governance violations, such as key managerial personnel (KMPs) holding directorships in other companies without prior IRDAI approval. Additionally, Policybazaar was penalised Rs 1 crore for delays in remitting insurance premiums to the respective inspection found that Policybazaar routed premium payments through its own nodal account and proprietary payment gateway, taking a minimum of three working days to remit funds. This practice contravenes Section 64VB of the Insurance Act, which mandates that intermediaries transfer premiums to insurers within 24 hours of a stock exchange filing, PB Fintech Ltd, the parent company of Policybazaar, confirmed the regulatory action and said the matter would be placed before the board of directors at its upcoming meeting. 'The Authority has levied a penalty of Rs 5 crore, vide its Order dated August 4, 2025, on Policybazaar, a wholly owned subsidiary of PB Fintech Limited,' the company said, adding that an action taken report would be submitted to the of PB Fintech were down 1.8% to Rs 1,750.10 on the Bombay Stock Exchange at around 9:40 am. - Ends
