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| Bangladesh-Insurance-Business-History |
Insurance Business of Bangladesh has a long history of evolution. About a century back, couple of insurance companies started both non life and life insurance business during the British regime in India. However, insurance business got the momentum during the East Pakistan regime. In the pre-liberation period, there were as many as 49 privately owned insurance companies underwriting non life insurance business along with one central Govt. run-organization, namely, Pakistan Insurance Corporation. After liberation war in 1972 The People's Republic Government of Bangladesh nationalized the insurance industry along with the banks in 1972 by Presidential Order No. 95. By virtue of nationalization order, 5 Corporations were set up to manage the insurance industry of which four were subsidiary corporation, two each for life and non life and an apex body, viz. Jatiya Bima corporation as a controlling corporation. Latest Insurance Company List In Bangladesh. At a later stage, the above five corporations were replaced by two state owned corporations namely, Sadharan Bima Corporation (SBC) for general business and Jiban Bima Corporation (JBC) for nor life business under a restructuring plan made in 1973 in order to curtail excessive administrative expenses of the aforementioned corporations.
Bangladesh Insurance History, Sadharan Bima Corporation (SBC) emerged on 14th May, 1973 under the Insurance Corporation Act (Act No. VI) of 1973 as the only state owned industry organization to deal with all classes of non-life insurance & re~insurance business emanated in Bangladesh. Again, in the process of denationalization, the Insurance Corporations Act was amended in 1984 to allow insurance companies to operate in the private sector subject to certain restrictions regarding business operation and reinsurance. Subsequent to that, the Act was further amended for the relaxation of the existing regulation to promote the private sector insurance companies. The Insurance Market in Bangladesh now consists of two state- owned corporations along with forty three private sector general and seventeen life insurance companies. Thus the insurance sector in Bangladesh has grown up substantially and deepened remarkably with number of companies in both life and general segments. With the expansion of size of the insurance market, the volume of assets of the industry has also increased substantially. Latest Insurance Company List In Bangladesh
Insurance History In Bangladesh. The gross premium of private sector general insurance business has been improving at a standard rate over the years. The general insurance industry of Bangladesh noted a gross premium of Tk.19.02 billion (provisional) in 2011 and Tk.16.54 billion in 2010 which was being shared by 44 companies including the Government owned Sadharan Bima Corporation (SBC) having gross premium of Tk.1.91 billion (provisional) in 2011 (Tk.1.66 billion in 2010). However, presence of large number of companies in a small market leads to tough market competitors and illegal methods which has already made a considerable number of sick insurance companies in the industry. Knowing the importance of revitalizing the sector in line with the international norms, the regulatory authority made compulsory credit rating in the industry from 2006. Under the above directives, all general insurance companies get credit rating report with mandatory surveillance at the end of each year.
Insurance industry of Bangladesh has suffered from undue political interference, fraudulent claims, inadequate risk assessments and limited quality private sector participation. In order to reduce risk of insurance business the parliament has enacted two Acts namely Insurance Development and Regulatory Authority Act, 2010 and Insurance Act, 2010 and replaced the age old insurance laws. The Department of Insurance has been abolished and substituted by the five-member Insurance Regulatory Authority headed by the Chairman. For further enhancing the solvency position, the paid up capital for non—life and life insurance companies Introduction Of new A“ have been raised to Tk. 400 million and Tk. 300 million respectively. The number of directors in the company has been fixed to 20 including 2 independent Directors and debarred the industry Directors of an insurance company to be a Director of another insurance company of same class and of a bank or a financial institution simultaneously.
Insurance Company In Bangladesh. The new Insurance law also introduced mandatory solvency margin for the insurance companies. Besides, the insurance companies , will be required to ensure international accounting standard, separate Islamic insurance from i conventional ones and put a limit on commission expenses. The law also allowed foreign investment in non life insurance sector. With the promulgation of the Acts, the insurance industry has been placed under the Ministry of Finance from the Ministry of Commerce. The government formed a five-member body to regulate the insurance sector. The authority has 1 been formed in line with the section 3, S (1) and 6 of the Insurance Development and Regulatory Authority Act-2010. The authority was aimed at proper control and supervision of the insurance sector to protect the interest of insurance policy holders besides" strengthening the financial base. Insurers hope that the law will bring significant changes in the industry.