The Insurance Regulatory and Development Authority (IRDA) has imposed a fine of INR1m on Max Life Insurance Company for breaching commission rules.
In its review, the Indian insurance regulator found that Max Life Insurance paid more commissions than permitted to Barclays Investments and Loans (India) Ltd during 2008-2009 and 2009-2010 fiscal years.
Max Life Insurance will pay the penalty of INR5m for each financial year, as per the regulator.
Contending its stand, the insurer said that of the total other pay outs of INR41.55m, INR7.45m was not paid to Barclays Investments and Loans, but was paid to other vendors.
The company has violated the provisions of class 21 of Corporate Agents Guidelines and has been advised to adhere to the regulations as per the Insurance Act, 1938.