Both Iffco Tokio General Insurance and Royal Sundaram General Insurance face similar charges of settling lesser amounts than the insured declared value in case of motor vehicle total loss/theft claims, as per two separate orders against the two firms.
The authority had conducted focussed onsite inspection of the insures in matters related to total loss and/or theft claims during the period 2009-10 and 2010-11, the Insurance Regulatory and Development Authority of India (Irdai) said in its orders.
“After considering all the factors, I am of the opinion that the charges relating to total loss/constructive total loss claims confirmed and the samples given (by them) stand testimony to this,” said the similarly worded orders signed by Irdai member (non-life) P J Joseph.
Irdai also said the companies violated File & Use guidelines and circulars issued by it from time to time advising insurers that they shall continue to use the coverage, terms & conditions, wordings, warranties, clauses and endorsements of the erstwhile tariff of classes of insurance covers until further orders.
“The penalty of Rs 5 lakh shall be remitted by the insurer(s) through NEFT/RTGS by debiting shareholders’ account within a period of 15 days from the date of receipt of this order,” Irdai said.