Insurance regulator IRDAI imposes Rs 5 crore fine on Policybazaar; here’s why

The Insurance Regulatory and Development Authority of India (IRDAI) has imposed a penalty of Rs 5 crore on Policybazaar Insurance Brokers Private Limited (formerly Policybazaar Insurance Web Aggregator), a wholly owned subsidiary of PB Fintech Limited, following the outcome of a regulatory inspection conducted in June 2020.

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The financial penalty, announced in an IRDAI order dated August 4, 2025, stems from multiple violations of regulatory norms, including lapses related to the roles of key managerial personnel, product display, outsourcing agreements, tagging of insurance policies, and premium remittance procedures.

“IRDAI in exercise of the powers under Section 102 of the Insurance Act, 1938, has imposed a penalty of Rs. Five Crore on M/s Policybazaar Web Aggregator Pvt. Ltd. (Now known as "M/s Policybazaar Insurance Brokers Pvt. Ltd.") along with Direction, Advisory and Caution for various violations established under Insurance Act, 1938 and Rules and Regulations made thereunder,” IRDAI said.

According to PB Fintech’s regulatory filing, the company received a show cause notice in early October 2024, following the inspection that was carried out between June 1 and June 5, 2020. The notice provided an opportunity for a personal hearing and the submission of additional documents. After reviewing Policybazaar’s response, the IRDAI concluded that regulatory breaches had occurred, warranting financial and advisory action.

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In addition to the monetary fine, IRDAI has issued a set of directions and advisories for the company, which it must implement within a time-bound framework. The company said the IRDAI’s order would be presented to the Policybazaar board in the upcoming board meeting, and an action taken report would be submitted to the regulator thereafter.

PB Fintech, the parent entity listed on Indian stock exchanges, said the financial implication is limited to the imposed penalty. “No impact is expected on the operation or other activities of Policybazaar,” the company said.

During the Q1 FY26, PB Fintech's net profit rose 347% year-on-year to Rs 84.5 crore, while revenue from operations increased 33.5% to Rs 1,348 crore.