The Insurance Development and Regulatory Authority has paid a total of Tk 14.51 crore in insurance claims to 2,549 policyholders by selling assets held by seven financially distressed life insurers, as part of efforts to clear long-standing dues and restore confidence in the insurance sector.
The authority said proceeds from the sale of land, government savings instruments and other investments belonging to financially weak insurers are being used to settle outstanding claims. The funds are being kept in separate bank accounts under regulatory supervision before being distributed to eligible policyholders according to the prescribed process.
Mira Nadia Nivin, chairman of the Insurance Development and Regulatory Authority, recently said an initiative had initially been taken to settle claims involving seven to eight financially troubled insurance companies. Assets including land, fixed deposits, government bonds and other investments are being assessed and monetised to generate funds for policyholders.
Some assets have already been sold, while the process of selling additional assets is under way. Under the plan, money raised through these transactions will be deposited into separate bank accounts maintained in the names of the respective insurers. Older claims will then receive priority as payments are made in phases.
The move is particularly significant for policyholders who have been waiting for years to receive money due under their insurance policies. Delays in settling legitimate claims have been one of the persistent concerns facing Bangladesh’s insurance industry, affecting public confidence in insurance products and institutions.
Despite the latest payments, the wider claims situation remains challenging. According to the authority’s latest figures, around 1.2 million insurance customers across the country still have unpaid claims. As many as 32 insurance companies are facing difficulties in settling outstanding claims, with the total value of unpaid claims reaching around Tk 4,403 crore by 2025.
The life insurance segment has also struggled to maintain a strong claims settlement record. In 2024, total life insurance claims stood at approximately Tk 13,056 crore. Insurers paid Tk 8,609.50 crore, equivalent to 65.94 per cent of the total claims. The settlement rate improved marginally to 66.54 per cent in 2025.
The general insurance segment recorded a considerably weaker performance. Against claims worth around Tk 4,322 crore in 2024, insurers paid only Tk 1,333 crore, resulting in a settlement rate of 30.84 per cent. The rate fell further to 25 per cent in 2025.
Regulators have linked the prolonged failure of some insurers to meet their obligations with the broader loss of confidence in the sector. Timely settlement of genuine claims is therefore being treated as an important part of efforts to rebuild trust among policyholders.
Alongside the claims settlement drive, the regulator is planning stronger supervision of insurance companies based on their financial risks. A risk-based monitoring framework is expected to help authorities identify financially vulnerable insurers and take action before their difficulties become more severe.
The authority is also working towards introducing a unique identification number for every insurance policy. Such a system would make it easier to maintain and verify information relating to individual policies and premium payments, while improving transparency in the management of customer records.
Concerns have also been raised over the accuracy of financial information submitted by some insurers. The authority has found inconsistencies between reported figures and actual financial information in certain cases. There have also been allegations involving the use of undisclosed information repositories by some companies.
To address such irregularities, insurers have been instructed to integrate their information systems within a specified timeframe. Companies failing to comply with regulatory directions could face legal action.
The latest asset-sale initiative addresses only a portion of the sector’s outstanding obligations, but it provides a mechanism for recovering funds from financially troubled insurers and directing them towards policyholders. The broader challenge will be to ensure that future claims are settled on time, insurers maintain accurate financial records and regulatory oversight identifies emerging weaknesses early.
For policyholders, the effectiveness of these measures will ultimately be judged by whether claims are paid when they become due. Clearing existing arrears while strengthening financial discipline and transparency across insurers will therefore remain central to restoring confidence in Bangladesh’s insurance industry.
