IRDAI Slaps ₹3.39 Crore Penalty on Star Health for Cyber Security Violations
Star Health and Allied Insurance Company has been penalized ₹3.39 crore by IRDAI for violating Information & Cyber Security Guidelines, 2023. The company received the order on July 25 and is considering appealing to the Securities Appellate Tribunal. While the financial impact is limited to the penalty amount, Star Health assures no impact on its operations. The insurer operates through 913 offices and over 14,000 network hospitals, employing about 17,000 people and has more than 7,75,000 licensed agents. In the fiscal year, Star Health reported a Gross Written Premium of ₹17,553 crore and a Net Worth of ₹8,668 crore.

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Star Health and Allied Insurance Company Limited , one of India's leading health insurance providers, has been hit with a substantial penalty by the Insurance Regulatory and Development Authority of India (IRDAI) for breaching cyber security guidelines.
Penalty Details
The IRDAI has imposed a fine of ₹3.39 crore on Star Health for multiple violations of its Information & Cyber Security Guidelines, 2023. The company received the order on July 25, as disclosed in a regulatory filing to the stock exchanges.
Nature of Violations
According to the IRDAI order, the penalty has been levied "with respect to certain aspects pertaining to safeguard of data and cyber security." The regulator has also issued a warning to the company, underscoring the seriousness of the breaches.
Company's Response
Star Health, in its filing, stated that it is "evaluating the options available for addressing the matter including appealing to SAT (Securities Appellate Tribunal)." The company has assured that while the financial impact is limited to the penalty amount, no impact is expected on its operations or other activities.
Regulatory Compliance
The IRDAI order also contains advisory directions for Star Health to comply with the regulations and guidelines issued by the Authority on this subject. This emphasizes the regulator's focus on ensuring robust cyber security measures in the insurance sector.
Company Overview
Star Health operates through an extensive network of 913 offices and over 14,000 network hospitals. The insurer employs about 17,000 people and has more than 7,75,000 licensed agents. In the fiscal year, Star Health reported:
Financial Metric | Amount (in ₹ crore) |
---|---|
Gross Written Premium | 17,553.00 |
Net Worth | 8,668.00 |
Market Impact
While the penalty is significant, it represents only a small fraction of the company's reported net worth. However, the incident highlights the increasing regulatory scrutiny on data protection and cyber security in the financial services sector.
As the insurance industry continues to digitize rapidly, this penalty serves as a reminder of the critical importance of maintaining robust information and cyber security protocols to protect sensitive customer data and maintain regulatory compliance.
Historical Stock Returns for Star Health Insurance
1 Day | 5 Days | 1 Month | 6 Months | 1 Year | 5 Years |
---|---|---|---|---|---|
-0.58% | +3.44% | +5.32% | +2.76% | -26.55% | -50.91% |