The IRDAI has warned Reliance Nippon Life Insurance (RNLIC) for excessive expenses; nearly Rs 600 crore above the prescribed limit, IRDAI’s July order reveals. The regulator only warned RNLIC since it observed that the expenses had not affected policy holders, the order further stated.
The regulator said that in seven years if RNLIC received two warnings, it would lead to an investigation and valuation of funds and expenses under applicable provisions. IRDAI said that the company was asked to give an explanation as the regulator had observed RNLIC has incurred management expenses to the tune of Rs 1,632 crore against the allowable limit of Rs 1,069 crore.
It had observed that the insurer had been non-compliant with the expense on management (EoM) limit in six out of eight years, between financial year 2008-09 and 2015-16. IRDAI had further asked RNLIC to furnish a certificate from an “actuary of the insurer” with regard to the fact that its policy holders or their interest were not impacted and there was compliance with product regulations.
