CMA Final · Risk Management in Banking and Insurance · Insurance Intermediaries
A person who is an insurance agent contravenes the Insurance Act, 1938 provisions on receiving commission, namely Section 40 or the regulations framed under it. According to Section 40(3), the agent is liable to a penalty which may extend to:
Under Section 40(3) of the Insurance Act, 1938, an insurance agent, intermediary or insurance intermediary who contravenes the commission provisions or the regulations framed under them is liable to a penalty that may extend to one lakh rupees.
- ARupees ten thousand
- BRupees one lakhCorrect
- CRupees ten lakh
- DRupees one crore
Explanation
Section 40(3) provides that an insurance agent, intermediary or insurance intermediary who contravenes the commission provisions or regulations is liable to a penalty which may extend to one lakh rupees. Larger amounts are not stated in this section.
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