Irdai slaps Rs 5 crore fine on Policybazaar for regulatory lapses; stock dips 3%

PB Fintech, the parent company of insurance aggregator Policybazaar, on Tuesday said that the Insurance Regulatory and Development Authority of India (Irdai) has imposed a penalty of Rs 5 crore for regulatory lapses, including issues related to directorships held by key managerial personnel.

The penalty follows an inspection conducted by Irdai in June 2020, after which a show-cause notice was issued to Policybazaar in October 2024. Policybazaar, which facilitates insurance selection for users, said the regulator passed the penalty order after considering its additional submissions and a personal hearing.

PB Fintech added that Irdai has also issued additional directions, though it did not disclose the specifics. The violations pertain to policy tagging and premium remittance, among other areas.

However, the company clarified that the order will not impact Policybazaar's operations.

In an exchange filing, PB Fintech stated: "This is to inform that Irdai had conducted an onsite inspection of Policybazaar Insurance Web Aggregator Pvt Ltd (now Policybazaar Insurance Brokers Pvt Ltd), a wholly owned subsidiary of PB Fintech Ltd, during the period from June 1, 2020 to June 5, 2020. Subsequently, a Show Cause Notice dated October 7, 2024, was received, followed by a personal hearing and further submissions. After reviewing these, Irdai issued an order dated August 4, 2025, levying a penalty of Rs 5 crore for violations of Irdai Regulations related to Directorships held by KMPs and Principal Officer, product display, outsourcing agreements, tagging of policies, and premium remittance. Irdai has also issued additional directions/advisory to be complied with in a time-bound manner."

Following the development, shares of PB Fintech dropped 2.58 per cent to a day's low of Rs 1,736.