IRDAI Imposes ₹3.39 Crore Penalty on Star Health Insurance
The Insurance Regulatory and Development Authority of India (IRDAI) has levied a penalty of ₹3.39 crore on Star Health and Allied Insurance for violating multiple provisions of the Information and Cyber Security Guidelines, 2023. Along with the fine, IRDAI has issued a formal warning to the company to improve its compliance and security standards.
Details of the Penalty and Violations
The penalty was announced in July 2025 following investigations that revealed various lapses in adhering to mandated cybersecurity and information security protocols.
Star Health Insurance failed to comply with multiple provisions under the updated Information & Cyber Security Guidelines, which are designed to protect customer data and maintain robust IT security frameworks for insurers.
Specific details of the breaches were not disclosed publicly, but the regulator emphasized the seriousness of safeguarding sensitive insurance data.
Star Health had faced a cyberattack in late 2024, where customer data was reportedly compromised, leading to heightened regulatory scrutiny.
Star Health Insurance Profile
Star Health operates through 913 offices, with a network of over 14,000 hospitals and more than 7.75 lakh licensed agents.
It employs about 17,000 people across India.
For the fiscal year 2024-25, Star Health reported a gross written premium of ₹17,553 crore and had a net worth of ₹8,668 crore.
Company Response and Impact
Star Health acknowledged the penalty in regulatory filings and stated it is reviewing all legal options, including the possibility of filing an appeal with the Securities Appellate Tribunal (SAT).
The insurer assured stakeholders that the fine will not affect its business operations or ongoing activities.
The company is currently strengthening its cybersecurity measures to comply fully with IRDAI’s guidelines.
Significance for the Insurance Sector
IRDAI’s action reflects a growing emphasis on cybersecurity and data protection compliance in the insurance industry amid increasing digitalization.
The regulator is enforcing stricter adherence to safeguard the interests of millions of policyholders across the country.
Frequently Asked Questions (FAQ)
Q1: Why was Star Health Insurance fined ₹3.39 crore by IRDAI?
Star Health was penalized for multiple violations of the IRDAI’s Information & Cyber Security Guidelines, 2023.
Q2: Did IRDAI issue any other action apart from the fine?
Yes, the regulator issued a formal warning to Star Health Insurance alongside the penalty.
Q3: Was customer data compromised in this case?
Star Health experienced a cyberattack in 2024 that affected customer data, which likely prompted increased regulatory scrutiny.
Q4: How significant is Star Health Insurance in the Indian market?
Star Health is one of the largest health insurers with a vast network of hospitals, agents, and a strong presence across India, with gross written premiums exceeding ₹17,500 crore in 2024-25.
Q5: What is the company’s response to the IRDAI penalty?
Star Health is reviewing legal options, including possible appeals, and is working to improve its cybersecurity measures without impacting business operations.
Published on: July 28, 2025
Published by: selvi
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