Mumbai: The Securities Appellate Tribunal (SAT) has served a notice to Insurance Regulatory and Development Authority of India (IRDAI) in adjudication of a case relating to SBI Life, the life insurance arm of SBI.
The insurer has sought relief against a decision of IRDAI asking it to refund Rs 275 crore to all its policyholders who had bought its Dhanraksha Plus policy in the past.
SAT is likely to hear the case against the IRDAI order, which came in March 2014, this week, a senior SBI Life official said.
SBI Life is the first insurer to approach SAT, which has so far been hearing appeals against capital market regulator SEBI.
The recently-gazetted Insurance Amendment Act allows SAT to hear appeal against IRDAI and has created a post of an additional judge to deal with insurance-related cases.
However, sources in the industry point out that in order to facilitate SAT to take up cases pertaining to insurance industry, the SEBI Act needs to be amended.
"Without amendments in the Sebi Act, whether SAT can hear insurance cases is yet to be examined," sources said.
"It is up to SAT whether they can adjudicate our case or not. They have admitted our case and all the parties, including IRDAI, have already been served notices," a senior SBI Life official told PTI.
Meanwhile, SBI Life has approached the Centre in a similar case.
"We had approached the Department of Financial Services (DFS) against another IRDAI order in which we have been asked to pay back the entire Rs 84 crore which we had collected from our policyholders under the Super Suraksha scheme," the official said.
"A good redressal mechanism has opened up now for insurers, but I don't think that there will be a flurry of activity from insurers' side of approaching SAT," HDFC Life Managing Director and Chief Executive Amitabh Chaudhry said.
Citing reasons thereof, he said "insurers can approach SAT on completion of inspection report by the regulator, which takes a considerable amount of time".
