IRDAI has slapped a ₹50 lakh fine on PB Fintech’s insurance aggregator arm — the digital platform behind Policybazaar — for violating multiple regulations. In a year already marked by rising scrutiny, this move raises fresh concerns for millions of Indians buying policies online. So, what did PB Fintech do wrong — and how can you protect yourself in 2025?
What Is the Issue?
PB Fintech runs India’s largest insurance aggregation platform — Policybazaar. Its aggregator arm allows users to compare plans from multiple insurers and purchase them online.
But according to IRDAI’s 20+ page order, the company was found violating several norms under the Insurance Web Aggregator Regulations, 2017. The violations ranged from how products were listed and premiums handled — to serious gaps in documentation and board-level disclosures.
This penalty follows an earlier ₹5 crore fine on its insurance broking arm.
Source: ebharat
What Were the Violations?
1. Display Bias in Plan Listings
IRDAI found that Policybazaar’s aggregator site promoted certain insurers more prominently, without clear logic or full disclosure of why they were shown as “Top Plans.”
2. Delayed Premium Remittance
User premiums collected on the platform were not being transferred to insurers within the mandated 24 hours, violating IRDAI’s 64VB regulations.
3. Missing Board-Level Disclosures
Several directors of PB Fintech failed to disclose external roles, breaching conflict-of-interest norms.
4. Weak Outsourcing Contracts
Contracts with telemarketing vendors and backend teams were found vague, overbilled, or without proper service level definitions.
Pros vs. Cons of Insurance Aggregators
Pros
- Easy comparison across insurers
- Transparent pricing (in theory)
- Fast online issuance
Cons (Revealed by IRDAI Audit)
- Biased listings that favour higher-commission plans
- Delayed policy activation if premium isn’t remitted in time
- Missing agent accountability during telephonic sales
Cost to the Company, Risk to the Buyer
While ₹50 lakh may seem like a small fine, it’s actually a signal to the entire insurance tech industry. Aggregators handle millions of policies — but are not insurers themselves. This means any errors, delays, or biases in their system can still leave policyholders exposed.
“Digital platforms must ensure complete transparency and fairness in insurance distribution,” said an IRDAI official close to the matter.
Source: Economic Times
Common Mistakes to Avoid When Using Aggregators
- Trusting “Top Plan” labels without comparison
- Not verifying policy confirmation from insurer
- Assuming aggregator call recordings are stored forever (they’re not always!)
- Relying on auto-generated PDFs as proof of active coverage
Also Read: Policybazaar Fined ₹5 Crore by IRDAI for Misleading Insurance Promotions — uncover how deeper violations by its broking arm led to one of the largest penalties in India’s digital insurance space.
Real-World Example
A buyer in Maharashtra purchased a health policy on Policybazaar in early 2024 but found that the premium was not transferred to the insurer for over 10 days. The policy lapsed, and when a claim was filed after hospitalization, it was rejected. The matter is now under consumer court review — but it shows how tech gaps can cost lives, not just money.
Tools You Can Use on eBharat.com
- Insurance+ Plan Matcher Tool
- Premium Calculator for Term + Health
- “Check Before You Click” Checklist (Coming Soon)
IRDAI’s ₹50 lakh penalty isn’t just a technical fine — it’s a red flag for anyone buying policies online. Always verify your policy, demand transparent comparisons, and double-check remittance timelines. For safer and smarter insurance shopping, explore unbiased tools like Insurance+ on eBharat.com — and make your next policy one you can truly trust.
