Summary: The Insurance Regulatory and Development Authority of India (IRDAI) has passed an Order against M/s IndusInd Bank Limited in its capacity as a Corporate Agent following an onsite inspection conducted in June 2023 and subsequent enforcement proceedings. The proceedings established certain violations relating to renewal notices, grievance redressal mechanisms for insurance policyholders, disclosures to the Authority and disclosures on the Corporate Agent’s website. A significant finding concerned the Bank’s grievance redressal framework. IRDAI found that the Corporate Agent had not established a dedicated, policyholder-facing mechanism for insurance grievances and had instead relied on generic banking mechanisms without providing insurance-specific IVR or website channels. Further, although the Corporate Agent represented during regulatory proceedings that it had addressed the issue, the grievance portal and screenshots subsequently submitted were test-verified by the Authority and found to be non-functional and incapable of generating complaint acknowledgments. The Competent Authority consequently imposed a penalty of Rs. 1 crore under Section 102 of the Insurance Act, 1938 for violation of Regulation 20(1) of the IRDAI (Registration of Corporate Agents) Regulations, 2015. The Corporate Agent has also been directed to strengthen its grievance redressal mechanism, place the Order before its Board and submit an Action Taken Report (ATR) to the Authority within 90 days from the date of the Order. IRDAI additionally issued cautions and advisories concerning deficiencies in renewal notices, regulatory disclosures and website disclosures regarding registration and the role of the insurance intermediary.
Insurance Regulatory and Development Authority of India
Press Release | 10th September 2026
Order in the matter of IndusInd Bank Limited (Corporate Agent)
The Insurance Regulatory and Development Authority of India (IRDAI) passed an Order against M/s IndusInd Bank Limited (‘Corporate Agent’), pursuant to an onsite inspection conducted during June 2023 and subsequent enforcement proceedings.
Based on the findings of the inspection, submissions made by the Corporate Agent, and the personal hearing conducted before a panel of two Whole-time Members, certain violations relating to renewal notices, grievance redressal mechanism for insurance policyholders, disclosures to the Authority, and disclosures on the Corporate Agent’s website were established.
The Corporate Agent failed to establish a dedicated, policyholder-facing grievance redressal framework, improperly relying on generic banking mechanisms rather than providing insurance-specific IVR or website channels. Furthermore, after promising compliance during regulatory proceedings, the Corporate Agent submitted representations and screenshots of a grievance portal that, upon test verification by the Authority, proved non-functional and failed to generate complaint acknowledgments.
After due consideration of the facts and submissions, the Competent Authority imposed a penalty of Rs. 1 crore (Rupees One Crore only) under Section 102 of the Insurance Act, 1938, for violation of Regulation 20(1) of the IRDAI (Registration of Corporate Agents) Regulations, 2015. The Corporate Agent has been directed to strengthen its grievance redressal mechanism. The Corporate Agent has also been directed to place the Order before its Board and submit an Action Taken Report (ATR) to the Authority within 90 days from the date of the Order.
The Authority also issued cautions and advisories in respect of certain other compliance deficiencies, including deficiencies in renewal notices, disclosure of regulatory actions to the Authority, and prescribed disclosures on the Corporate Agent’s website regarding its registration and role as an insurance intermediary.
The detailed Order is available on the IRDAI website at Order in the matter of IndusInd Bank Limited
IRDAI remains committed to ensuring policyholder protection, transparency, accountability and compliance with the regulatory framework across the insurance sector. The Authority will continue to take appropriate supervisory and enforcement action wherever regulatory violations are observed.
Insurance Regulatory and Development Authority of India
Ref: IRDAI/E&C/ORD/MISC/119/9/2026
Order in the matter of M/s IndusInd Bank Limited (CA) arising out of Show Cause Notice Ref. No. IRDA / ENF / 2024 / 770 / SCN / LR / 087 dated 26th March, 2025
1. Based on the
1.1 Show Cause Notice (“SCN”) Ref. No. IRDA/ENF/ 2024/770/SCN/LR/087 dated 26th March, 2025 issued to M/s IndusInd Bank Limited. (‘Corporate Agent’ or ‘CA’) in connection with the Onsite inspection conducted by the Authority from 19th June 2023 to 22nd June 2023.
1.2 Submissions made by the CA vide email/letter dated 15th April 2025 in response to the aforesaid SCN.
1.3 Submissions made by the CA during the personal hearing held on 13th April, 2026, before the panel of two whole-time members of the Authority – Shri Swaminathan S Iyer (Member Life) and Shri Deepak Sood (Member Non-Life).
1.4 Further submissions made by the CA post-hearing vide email dated 20th April 2026.
2. Background
2.1 The Authority had conducted an onsite inspection of the Corporate Agent, M/s IndusInd Bank Limited (herein after referred as ‘CA’) from 19th June 2023 to 22th June 2023. The inspection report, inter alia, revealed certain violations of provisions of the Insurance Act, 1938 and Regulations, Guidelines and Circulars issued thereunder.
2.2 A copy of the inspection report was forwarded to the CA on 21st July 2023 seeking their response and the CA submitted their response vide email dated 11th August 2023.
2.3 On examining the submissions of the CA, an SCN was issued on 26th March, 2025. The Corporate Agent replied to the SCN vide email dated 15th April, 2025.
2.4 As requested for by the CA, a personal hearing was granted to the CA on 13th April, 2026 by the panel of two Whole Time Members comprising Shri Swaminathan S Iyer (Member Life) and Shri Deepak Sood (Member Non-Life).
2.5 On behalf of the CA, Shri Samir Dewan, Country Head – Affluent Banking International Business, Wealth & Para Banking, Shri R Uppily (Unit Head – Third Party Products Operations), Smt. Anuja Gill, Product Head – Life Insurance, Shri S. T. Krishnekumaar, Principal Officer and on behalf of the Authority, Shri RK Sharma (Chief General Manager), Shri Sanjay Kumar Verma (General Manager) and Shri Monu Moar (Assistant Manager) attended the hearing.
2.6 The submissions made by the CA vide its letter dated 11th August 2023 and the submissions made after SCN vide email dated 15th April, 2025, submissions during the personal hearing on 13th April, 2026 and further submissions made post hearing vide email dated 20th April 2026 have been carefully considered by the Authority.
3. Charge-1 (Inspection Observation_1)
Violation of
3.1 Proviso 4(b), 4(d), 4(e), under Part III (Post Sale Code of Conduct) of Schedule III read with Regulation 26 (1) of IRDAI (Registration of Corporate Agents) Regulations, 2015.
Inspection Observation_1
3.2 The CA is not issuing renewal notices to customers as per the regulatory requirement. The renewal notices to the policyholders are being sent through SMS only. The SMS lacks key elements outlined in the code of conduct, such as duty to disclose changes affecting the policy since inception or the last renewal. Additionally, it does not advise the policyholder to retain records, including copies of correspondence, related to the renewal processes.
Brief of Submissions made by the Corporate Agent:
3.3 The CA submitted that it assists remittance of premium by the Policy holders by sharing the renewal notices of the Insurer to the policy holders on time by sending SMS alerts apart from the calls made by the branches to the respective customers.
3.4 These SMS’s are sent with URL link wherein, the Recipient-Insured can indicate/ incorporate details of all changes and make other disclosures affecting the renewal and policy issuance to the Insurer.
3.5 The notice specifically reiterates that the Insurer would be giving effect to the renewal as per extant underwriting and other guidelines
3.6 The CA submitted that as a process, renewal intimations are sent to the customers. In the digital route, insured directly responds to Insurer by incorporating all changes he needed and confirms other existing asset coverage details, directly in the Insurer portal and CA facilitates this process by sending SMSs from time to time with embedded URLs leading to Insurer’s Web portals.
3.7 CA submitted that the respective Insurers send timely renewal notices vide electronic (email) / physical mode (where the email ids are not available) one month prior to the due date of renewal.
3.8 The Renewal due SMS notifications which are sent by the CA, have a URL link which enables the customer to disclose/ advise changes affecting the policy, which have occurred since the policy inception or the last renewal date.
Issues and Concerns:
3.9 The Corporate Agent is issuing renewal intimations to policyholders only through SMS communications, which merely contain reminders for payment of renewal premium and do not constitute comprehensive renewal notices as contemplated under the regulations.
3.10 On perusal of the sample SMS communications, it was noted that the renewal notices do not contain any warning regarding the duty of disclosure, including the necessity for the policyholder to intimate any changes affecting the policy which may have occurred since the inception of the policy or since the last renewal. The said omission is in violation of Proviso 4(d) of Part III (Post Sale Code of Conduct) of Schedule III to the IRDAI (Registration of Corporate Agents) Regulations, 2015.
3.11 It is further observed that the renewal notices issued by the Corporate Agent do not contain any requirement or advisory for maintaining records, including copies of letters and other information supplied to the insurer for the purpose of renewal of the contract. The renewal SMS does not fulfil the requirements of Proviso 4(e) of Part III (Post Sale Code of Conduct) of Schedule III to the aforesaid Regulations.
3.12 The renewal process is an important stage in the insurance contract, and the prescribed disclosures and advisories are essential for safeguarding policyholder interests and ensuring fair conduct by the Corporate Agent.
Decision on Charge-1
3.13 The CA is cautioned for the lapses and advised to ensure continued compliance with the relevant provisions of the respective Regulations and Circulars/Master Circulars issued by the Authority from time to time.
4. Charge-2 (Inspection Observation-2)
4.1 Violation of Clause (1) of Regulation 20 of IRDAI (Registration of Corporate Agents), Regulations, 2015.
Inspection Observation-2:
4.2 The CA Agent did not have Grievance Redressal Mechanism for its policyholders and no option to lodge the complaint by the policyholder under IVR of Toll Free Number was provided. The Grievance Redressal Policy and Grievances Mechanism displayed at the web-site of the CA are formed exclusively for its Bank related customers only. There is no mention of insurance related reporting requirements to the aggrieved policyholders and no reference to IRDAI PPI Regulations, 2017.
Summary of CA’s Submissions:
4.3 The CA submitted that they have Grievance Redressal Mechanism for all products and the same is hosted in the Bank’s website.
4.4 The TAT adherence and quality of resolution, per complaint, is diligently monitored by the Customer Service Team of the Bank, across all complaint categories including Insurance.
4.5 The Complaints/Query/Request relating to Insurance are captured in the bank’s Customer Relationship Management System (CRM) and monitored for closure with specific turnaround time.
4.6 The CA further submitted that it has a Senior Official of the Bank Mr. Dickson Baptista, Head Customer- Care to handle the Grievance Redressal for Complaints of all customers and products including Insurance.
4.7 The Bank cross sell insurance only to its customers, example; Branch Banking, Credit Card etc. The Bank is responsible at enterprise level, for all complaints and the said complaints are monitored and resolved vide the tenets of Customer Grievance Redressal Mechanism & Policy. The complaints are segregated duly and handled by Subject Matter Experts (SMEs).
4.8 The CA only solicits insurance from its customers only. All the customer touchpoints referred to the primary relationship the customer holds with the Bank – Banking / Credit Cards, also while closure of all complaint the next level of escalation is provided to the customer for ease of reference. The bank is obliged with feedback from the Authority during inspection and have enhanced its Grievance Redressal Policy & Mechanism.
4.9 The Bank is bound by various Regulators to ensure compliance and as per the Bank’s overall grievance redressal policy on handling customers’ complaints. For logging any Insurance related issues, the IVR handles all complaints including Insurance, the customers can speak to Customer support by pressing 1 during the call and selecting sub menu 1. A detailed walk-through of the IVR and toll-free processes were given during the inspection. Further CA submitted that, IVRs did not have any disruption during the FY 23-24, also there were no complaints reported for IVR not working during this period.
4.10 The CA submitted that they implemented the Grievance Redressal Mechanism on their website and communicated by a letter dated 25th June, 2026.
Issues and Concerns:
4.11 The Toll-Free Number / IVR facility maintained by the CA did not provide any option for policyholders to lodge insurance-related grievances. The absence of a dedicated complaint registration mechanism for insurance policyholders indicates failure on the part of the CA to establish an accessible grievance redressal framework for servicing insurance customers exclusively.
4.12 The CA’s submissions do not answer the specific and material deficiency identified during the Inspection. The existence of a grievance mechanism for the Bank’s general banking customers is not a substitute for a dedicated, clearly signposted mechanism through which an insurance policyholder who may or may not otherwise be a banking customer of the Corporate Agent can identify, access, and lodge an insurance-specific grievance, and be made aware of the escalation and reporting framework applicable to insurance grievances under the then IRDAI (Protection of Policyholders’ Interests) Regulations, 2017. An internal CRM-based tracking system and generic customer-service escalation, without a policyholder-facing, insurance-specific channel and disclosure, does not meet the requirement of Regulation 20(1) of IRDAI (Registration of Corporate Agents) Regulations, 2015, which casts a distinct and non-delegable obligation on an CA to service and protect the interests of insurance policyholders.
4.13 The absence of any option to lodge an insurance grievance through the IVR of the toll-free number, taken together with the complete absence, prior to the Personal Hearing, of any insurance-specific grievance redressal disclosure on the CA’s website, establishes that the deficiency was not a transient or clerical lapse but a structural failure to institutionalise a policyholder grievance framework, continuing over a substantial and continuous period up to the date of the Personal Hearing.
4.14 The Authority notes with grave concern that the CA, having represented compliance to the Authority both orally at the Personal Hearing and in writing vide its post-hearing letter dated 20.04.2026 furnished screenshots represented to demonstrate a functional revised grievance redressal mechanism. During the Personal Hearing, the Principal Officer of the CA submitted that the grievance redressal mechanism would be simplified and made accessible on the home page of its website on or before 30th June 2026, which commitment was reiterated in writing vide letter dated 20.04.2026 filed as part of post-hearing submissions.
4.15 On verification by the Authority through a test complaint lodged on the said portal, it was noticed that no acknowledgment whether by way of a reference number, SMS, or email was generated or communicated to the complainant at any stage. This establishes that the mechanism represented as functional and compliant was not, in fact, functional at the time such representation was made to the Authority. This serious lapse indicates that even now the CA does not have system to register and acknowledge the complaints of policyholders.
4.16 This conduct is treated by the Authority as an aggravating factor of a serious nature, independent of and in addition to the underlying regulatory violation. A regulated entity’s representation to its regulator, made both orally in a Personal Hearing and in writing thereafter, carries a heightened duty of true and authentic disclosure. Furnishing material that does not reflect the real and functional state of compliance, in the course of proceedings before the Authority, has the tendency to obstruct effective regulatory oversight and to undermine the integrity of the compliance-verification process itself quite apart from the original default. Therefore, such lapse cannot be treated as an innocent or inadvertent, given the specificity and timing of the representation.
4.17 Hence, the Authority concludes that that the CA having specifically represented compliance to the Authority both orally during the Personal Hearing and in writing, furnished submissions and supporting screenshots that did not reflect the true and functional state of the grievance redressal mechanism.
4.18 In view of the above, the Authority holds that the CA has failed to put in place and implement an appropriate grievance redressal mechanism and reporting framework for insurance policyholders as envisaged under Regulation 20 (1) of the IRDAI (Registration of Corporate Agents) Regulations, 2015 relating to Board Approved Policy for Open Architecture.
Decision on Charge-2
4.19 In view of the above, in exercise of powers contained under Section 102 of Insurance Act, 1938, the Authority imposes a penalty of Rs. One Crore (Rs. 1,00,00,000) on the CA for violation of Regulation 20(1) of the IRDAI (Registration of Corporate Agents) Regulations, 2015, as the default is still continuing.
4.20 The CA is also directed to revisit and strengthen its Grievance Redressal Mechanism, so as to ensure that an acknowledgment number in respect of every complaint is generated and issued immediately upon lodging of the complaint by the policyholder/complainant, without exception.
5. Charge-3 (Inspection Observation-3)
5.1 Violation of Regulation 22(3) (Disclosures to the Authority) of IRDAI (Registration of Corporate Agents) Regulations, 2015.
Inspection Observation-3
5.2 The CA has failed to disclose on the imposition of penalty and actions/directions issued by the regulatory body and/or government bodies upon it to the Authority:
5.3 CA was asked to furnish details of penalties imposed & warnings/ advisories issued by any regulatory body and/or government bodies during the last two financial years and documentary evidence for bringing of the same to the notice of the Authority. In response CA submits, RBI levied Penalty of INR10 million for executing certain non-permissible transactions in accounts opened using OTP based e-KYC in non-face-to-face mode, Penalty of INR 10 million for non-compliance of ‘Loans and Advances’ to NBFCs, Letter of Displeasure for non-compliance of certain provisions pertaining to automation of Income Recognition, Asset Classification and Provisioning processes.
5.4 SEBI levied Penalty of INR 10 million for loans sanction to CG Power.
5.5 ED levied Penalty of INR 5 million for non-adherence of Regulation 3 & 4 of (Foreign Exchange Derivatives Contracts) Regulation, 2000 and notice received in respect of fraudulent transactions of INR 0.15 million.
Summary of CA’s Submissions:
5.6 The CA submitted that they presumed that proceeding only pertaining to Insurance to be provided, however the observation was duly noted at the time of inspection & the details of all proceedings and penalties were provided on 17th June 2023, before the Inspection within 24 hours of the email from the Authority. Further the CA regrets this unintentional delay and ensured that the timelines are adhered to.
Issues and Concerns:
5.7 In terms of Regulation 22(3) (Disclosures to the Authority) of IRDAI (Registration of Corporate Agents) Regulations. 2015, it is the responsibility of the CA to disclose to the Authority proceedings initiated against them by other regulatory or Government bodies within a reasonable time but not later than 30 days from the initiation of such proceedings. Any action or direction issued by such other bodies shall also be disclosed to the Authority within the time limits prescribed above.
5.8 The CA did not disclose the penalties imposed by the ED, RBI & SEBI to the Authority in terms of Regulation 22(3) (Disclosures to the Authority) of IRDAI (Registration of Corporate Agents) Regulations, 2015.
Decision on Charge-3
5.9 The CA is cautioned for the lapses and advised to ensure compliance with the relevant provisions of the respective Regulations and Circulars/Master Circulars issued by the Authority from time to time.
6. Charge-4 (Inspection Observation-4)
Violation of
6.1 Regulation 9 (1) (ii) of IRDAI (Insurance Advertisements and Disclosure) Regulations, 2021.
Inspection Observation-4:
6.2 The CA did not disclose the Registration No. granted by IRDAI on its website and also did not give due publicity to the fact that the CA does not underwrite the risk or acts as insurer to be visible for any website visitor to get the knowledge of IndusInd Bank as a Corporate Agent of the Life and General Insurers with whom they may have arrangements to solicit, procure and service their insurance products.
Summary of CA’s Submissions:
6.3 The CA submitted that the Registration number granted by the Authority was disclosed on the inner pages of the website, including the “Disclaimer section.
6.4 The Inspection team’s suggestion for displaying the same in all the pages instead of only being shown on the inner pages of the Website, was immediately taken up and the pages were re-designed and hosted. The Authority suggested that the Disclaimer, UIN number, and CA Registration number should also appear on all product pages.
Issues and Concerns:
6.5 It is observed that the CA did not display the Certificate of Registration Number granted by the Authority on its website, as mandated under Clause 9(ii) relating to “Advertising on the internet or through electronic media” of the IRDAI (Insurance Advertisements and Disclosure) Regulations, 2021.
6.6 The website of the CA did not contain any clear and prominent disclosure informing visitors that the Corporate Agent merely acts as an insurance intermediary and neither underwrites the insurance risk nor functions as an insurer. The absence of such disclosure has the potential to mislead customers regarding the nature and extent of responsibility of the CA vis-à-vis the insurance products solicited through its platform.
6.7 It is also noted that the CA fell short of giving adequate publicity and visibility on its website regarding its role as a Corporate Agent of the Life and General Insurers with whom it has arrangements for solicitation, procurement and servicing of insurance products. Such omission reflects lack of transparency in dissemination of material information to policyholders and prospective customers accessing the website.
6.8 The disclosures prescribed under the regulatory framework are intended to ensure transparency, accountability and informed decision-making by policyholders while dealing with insurance intermediaries through electronic platforms.
Decision on Charge-4
6.9 The CA is cautioned for the lapses and advised to ensure continued compliance with the relevant provisions of the respective Regulations and Circulars/Master Circulars issued by the Authority from time to time.
7. Charge-5 (Inspection Obesrvation-5)
Violation of
7.1 Regulation 30 (iii) of IRDAI (Registration of Corporate Agents) Regulations, 2015.
7.2 Para 4 (c) of Authority’s circular number IRDA / INSP / CIR / ONS / 157 / 09 / 2018 dated 19th September 2018.
Inspection Observation-5:
7.3 Discrepancies in data were observed as the premium was either remitted to insurer before receipt from the client or there was delay in remitting the premium to the insurer or sum insured data was in negative or most of the data under the date of premium / date of remittance were not filled-up.
Summary of CA’s Submissions:
7.4 The CA submitted that the errors identified in the premium register were due to inclusion of other data relating to cancellation, endorsement and long-term policy details in the data dump in addition to regular policy issuance data.
7.5 As the dump was submitted in its entirety, the transaction line items were reflecting inconsistencies observed.
7.6 There was no issue in the data but in collation of data only and the same was identified and requisite data was submitted before the Inspection started.
Decisions on Charge-5:
7.7 The CA’s submission that the inconsistencies were observed due to inclusion of other data relating to cancellation, endorsement and long-term policy details in the data dump in addition to regular policy issuance data is taken on record and the charge is not pressed further.
8. Summary of Decisions:
| Charge No. | Violation of Provisions | Decision |
|---|---|---|
| 1 | Proviso 4(b), 4(d), 4(e), under Part III (Post Sale Code of Conduct) of Schedule III read with Regulation 26 (1) of IRDAI (Registration of Corporate Agents) Regulations, 2015. | Caution & Advisory |
| 2 | Clause (1) of Regulation 20 of IRDAI (Registration of Corporate Agents), Regulations, 2015 | Penalty of Rs. One crore and Direction. |
| 3 | Regulation 22(3) (Disclosures to the Authority) of IRDAI (Registration of Corporate Agents) Regulations, 2015 | Caution & Advisory |
| 4 | I. Regulation 9 (1) (ii) of IRDAI (Insurance Advertisements and Disclosure) Regulations, 2021.
II. Proviso 2(g), under Part I (General Code of Conduct) of Schedule-III read with Regulation 26 (1) of IRDAI (Registration of Corporate Agents) Regulations, 2015. |
Caution & Advisory |
| 5 | I. Regulation 30 (iii) (Maintenance of Records) of IRDAI (Registration of Corporate Agents) Regulations, 2015.
II. Para 4 (c) of Authority’s circular number IRDA / INSP / CIR / ONS / 157 / 09 / 2018 dated 19th September 2018. |
Charge Not Pressed. |
9. Further,
a) The Order shall be placed before the Board of the CA in the upcoming Board Meeting and the CA shall provide a copy of the minutes of the discussion.
b) The CA shall submit an Action Taken Report to the Authority on direction given within 90 days from the date of this Order.
10. If the CA feels aggrieved by this Order, an appeal may be preferred to the Securities Appellate Tribunal as per the provisions of Section-110 of the Insurance Act, 1938.
Swaminathan S Iyer
Member (Life)
Deepak Sood
Member (Non-Life)
Place: Hyderabad
Dated: 10th September 2026
