IRDAI Transfers Sahara India Life Insurance Business To SBI Life

The Insurance Regulatory and Development Authority of India (IRDAI) announced on Friday, June 2, its decision to transfer Sahara India Life Insurance's life insurance business to SBI Life Insurance Company.

According to IRDAI, Sahara India Life Insurance Co. Ltd (SILIC) was awarded a Certificate of Registration in 2004 to conduct life insurance business. In 2017, the Authority appointed an Administrator to supervise the insurer's operations.

"Despite being provided ample opportunities and sufficient time to ensure compliances, SILIC has failed to comply with directions of the Authority and take any affirmative steps to protect the interests of its policyholders. Despite being provided ample opportunities and sufficient time to ensure compliances, SILIC has failed to comply with directions of the Authority and take any affirmative steps to protect the interests of its policyholders," the insurance regulator said in a press release.

"Further, the policy data of SILIC reveals that the company's portfolio is showing a run-off trend. The financial position has been deteriorating with rising losses and higher percentage of claims to total premium. If the trend is allowed to continue, the situation will worsen and lead to erosion of capital and SILIC may not be able to discharge its liabilities towards policyholders, thereby endangering the interest of its policyholders, regulator added

The Authority said during its meeting today, that action is necessary to protect the interests of SILIC policyholders. As a result, the Authority decided to transfer SILIC's life insurance business to another suitable life insurer with immediate effect, in accordance with its powers under sub-section (2) of Section 52B of the Insurance Act, 1938.

The insurance regulator has announced that SBI Life will take over the policy liabilities of approximately two lakh SILIC policies, ensuring the security of policyholders' assets with immediate effect.

The regulator said that it has "taken necessary steps to ensure the smooth transition for all policyholders of SILIC. A committee comprising of Member (Actuary), Member (Life), and Member (F&I) has been constituted for implementation of the Order in a timebound manner."

SBI Life has been directed to take appropriate actions to reach out to SILIC policyholders regarding policy servicing, including the establishment of a dedicated cell to resolve SILIC policyholders' inquiries, and to publish required facts on their website. The Authority will continue to monitor the situation and will issue any necessary directions in the best interests of SILIC policyholders.