1. IRDAI directs Sahara Life Insurance Co. not to procure new insurance business
By its order dated June 23, 2017, IRDAI has directed M/s Sahara India Life Insurance Co. Ltd. (“Company”), not to procure / collect proposal deposits / underwrite new business with immediate effect. However, the Company has been allowed to continue to collect and account for the Renewal Premium and to service the existing business and policyholders, unhindered. The order has been passed by IRDAI in exercise of the powers conferred upon it by Section 52 B (2) of the Insurance Act, 1938 and the same is binding on all persons concerned, and shall have effect notwithstanding anything in the memorandum or articles of association of the Company.
2. Tussle between the Insurance Regulator and Sahara India Life Insurance Company
IRDAI had reasons to believe that Sahara India Life Insurance Co. Ltd. was acting in a manner likely to be prejudicial to the interests of holders of life insurance policies. Therefore, IRDAI, on June 12,appointed its General Manager as administrator for the Lucknow-based Sahara India Life Insurance under section 52 A of the Insurance Act, 1938. Based on the administrator’s report, vide order dated June 23, 2017, IRDAI directed Sahara Life not to procure/collect proposal deposits /underwrite new business, with immediate effect. Subsequently, the Insurance Regulator passed an order dated July 28, 2017 in terms of Section 52 B (2) of the Insurance Act, 1938 directing ICICI Prudential Life Insurance Co. Ltd. to take over the life insurance business portfolio of Sahara India Life Insurance Co. Ltd. with effect from 31st July 2017. The aforesaid orders have been challenged by Sahara Life before the Securities Appellate Tribunal under section 110 of Insurance Act, 1938. The matter is posted for hearing on August 10, 2017.
(Disclosure: Suvan Law Advisors is representing IRDAI before the Securities Appellate Tribunal in these matters.)