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Trichy, Tamil Nadu, India
Working as an Assistant in LIC of India, Rockfort BO, Trichy, TN. Having a strong belief that LIC's welfare is our welfare and always trying to work towards that. Also functioning as an office bearer of AIIEA Thanjavur Division.

Sunday, November 28, 2010

Irda slaps Rs 5 lakh fine on Tata AIG

TATA AIG Life's Expenses of Management for the years
2008-09 is 114.90%
2009-10 is 117.28%
i.e. the Co. is spending more money than it's premium collection, it seems. 
Can a company, which spends more than it collects, repay the money to policyholders? 
Explain to your clients and friends!

The Insurance Regulatory and Development Authority (Irda) has slapped a fine of Rs 5 lakh on Tata AIG Life Insurance for alleged violation of regulatory guidelines.

In an order, Irda said Tata AIG Life's expenses of management crossed the prescribed limit in 2008-09, following which the regulator had asked the insurance firm to ensure convergence with regulatory norms. 

But the EoM statement submitted by Tata AIG Life for 2009-10 indicated that the company did not follow the regulator's directive. 

"This is a violation of Irda’s direction...,” the order said. Accordingly, the company has been directed to pay a penalty of Rs 5 lakh within 10 days.

The Irda order pointed out that Tata AIG Life went on an expansion spree by opening branches in 2009-10, even though it had assured Irda that it would restrict its expenses.

“Contrary to the directions of the authority and assurances provided by the company to the authority while requesting for approval to open new branches offices in 2009-10, Tata AIG has not complied with the limits on EoM,” it said. 
Courtesy: MoneyGuru

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