Dhaka,  Sunday
14 April 2024

Bancassurance service starting from today

Sanjay Adhikari Rony

Published: 08:18, 1 March 2024

Bancassurance service starting from today

Photo : Collected

Bancassurance services are being inaugurated today on the occasion of National Insurance Day. Through this, insurance sales services will initially be available in select private bank branches starting next Sunday. This service will gradually expand.

This year, the theme of National Insurance Day is ‘Insurance will build the country, Bangladesh will be smart’. Bangladesh Bank has already released a policy for launching bancassurance services. It states that banks can sell various insurance products and services as corporate agents.

A bank can sell a maximum of three life insurance and three general insurance products simultaneously. Only banks with actual non-performing loans of less than 5 percent can join this service. Banks will also assist in handling insurance claims for customers after selling insurance products.

Some domestic and foreign banks have already obtained approval from the central bank to provide bancassurance services in accordance with the policy. The private sector’s City Bank was the first to start the service last month, followed gradually by other banks obtaining permission from the central bank.

Currently, a total of 82 life and non-life insurance companies are providing insurance services in the country. Approximately 1,71,10,000 people in the country are currently covered by insurance. To enhance the sector's reputation, authorities have directed companies to prioritise insurance claim settlements. As a result, insurance claims settled, both life and non-life, increased by 4 percent in 2023 compared to 2022.

In this regard, Mohammad Zainul Bari, Chairman of the Insurance Development and Regulatory Authority (IDRA), said that the Prime Minister recognised the importance of insurance and ordered the formulation of a new insurance law by revising the old law. Furthermore, the Insurance Development and Regulatory Authority formulates laws. In 2011, the directorate was abolished, and the Insurance Development and Regulatory Authority was established to restore order in the insurance sector.

The IDRA Chairman also mentioned that Corporate Governance Guidelines-2023 and Regulatory Sandbox Guidelines have been issued to modernise the insurance system. Bancassurance has been introduced to market insurance products through banks.

He further mentioned that Bangabandhu Shiksha Bima was launched as a tribute to Bangabandhu. Initially, 50,000 students were covered in the pilot phase funded by the Insurance Development and Regulatory Authority through Jiban Bima Corporation.

It is important to note that, besides the government, private companies have also introduced the Bangabandhu Shiksha Bima policy. Crop insurance, expatriate insurance, health insurance, Hajj insurance, micro-insurance, and cattle insurance have been introduced under the social insurance system. Additionally, insurance is available against accidents and natural calamities.