IRDAI Imposes a Rs 1 Crore Penalty on IndusInd Bank Over Insurance Grievance and Reporting Lapses

The Insurance Regulatory and Development Authority of India (IRDAI) imposed a monetary penalty of Rs 1 crore on IndusInd Bank for non-compliance with insurance-related grievance redressal and reporting requirements in its role as a corporate agent distributing insurance products. Banks that sell insurance act as corporate agents licensed by IRDAI and are bound by its registration, conduct and reporting norms; failures in logging, escalating or reporting policyholder complaints attract penalties under the Insurance Act, 1938. The order continues a run of regulatory action on bancassurance conduct, where mis-selling and weak complaint handling have drawn scrutiny from both IRDAI and the Reserve Bank of India.