Finding it guilty on multiple counts, Insurance Regulatory and Development Authority of India (IRDAI) has slapped a penalty of Rs 1.11 crore on insurance web aggregator Policybazaar and has also issued a stern warning against violation of rules in future.
The regulator has directed the firm to deposit the penalty within 15 days from the receipt of the order.
"lf the web aggregator feels aggrieved by the above decision in this order, an appeal may be preferred to the Securities Appellate Tribunal as per Section 110 of the lnsurance Act, 1938," the IRDAI order stated.
The IRDAI in its order said that Policybazaar had failed in complying with the Regulations on Insurance Web Aggregator Regulations issued in 2013 and 2017 which had been created to protect the interest of the policyholders and regulate the business of web aggregation.
"This is evident from the penalties and the warning issued for violations of Insurance Web Aggregator Regulations," it said.
This comes nearly three months after the Delhi High Court slapped a Rs 10 lakh fine on Policybazaar for concealing facts to obtain a favourable order in a trademark infringement case filed by it against Acko.
"The stature of a party or enormity of the claim should not be a constraint for the court to advance the cause of justice. Courts should not allow a party to get away with concealment of material facts when it comes to matters relating to grant of relief that are founded on principles of equity," Justice Sanjeev Narula said in a May 28 order while imposing fine.
The court asked the firm to deposit Rs 5 lakh with the Prime Ministers Relief Fund and other Rs 5 lakh with Delhi Legal-Aid Services Authority.
On May 16, the court had restrained Acko General Insurance from using the trademark 'policy bazaar' in any manner or form or combination or as an adword/key word programme through Google.
Later, Acko approached the court saying the Policybazaar had concealed and distorted material facts, made misrepresentations and false statements before this court to obtain the ex-parte ad-interim injunction order.
Acko told the court Policybazaar had clandestinely approached this court alleging infringement on the part of Acko for making reference to 'POLICYBAZAAR' as a keyword when Policybazaar themselves were making reference to Acko and its group company's registered trade mark 'ACKO' as a keyword.
The Policybazaar admitted to doing so, but told the court it had stopped that since April 23.
The court said by concealment of this material fact, the Policybazaar had taken unfair advantage over the Acko and directed that the May 16 order of injunction should remain suspended till July 11, the next date of hearing.