Three-Pillar Plan for Insurance Sector Reform

Bangladesh’s insurance sector must be reformed through a comprehensive three-tier strategy focused on restoring public confidence, strengthening the regulatory framework and investment environment, and improving the industry’s overall capacity, according to Insurance Development and Regulatory Authority (IDRA) Chairman Mir Nadia Nivin.

Speaking at a post-budget seminar in the capital on Saturday, the IDRA chief said rebuilding trust among policyholders should be the foremost priority if the country’s insurance industry is to become sustainable and more effective. He stressed that regulatory reforms alone would not be enough unless customers regain confidence that insurers will honour their commitments in a timely and transparent manner.

The seminar, titled Future Prospects and Challenges of Bangladesh’s Insurance Sector in Socio-Economic Development, was organised by the Insurance Reporters Forum (IRF) at Hotel Ekattor in Bijoynagar, Dhaka. The event brought together policymakers, regulators, industry leaders and journalists to discuss the sector’s current challenges and its future direction.

Highlighting the scale of the industry’s problems, Mir Nadia Nivin revealed that outstanding insurance claims currently stand at around Tk 70 billion. He explained that while some of these unresolved claims stem from long-standing structural weaknesses within the insurance sector, others are the result of irregularities and poor management practices by specific insurance companies. Efforts are already underway to address both categories of problems, he added.

The IDRA chairman also pointed to complications surrounding the disposal of assets held by a number of insurance companies. According to him, resolving these issues quickly is essential for improving the financial health of the sector and ensuring that companies can meet their obligations to policyholders.

To enhance transparency and accountability, he emphasised the need to introduce a risk-based supervisory framework. Such a system, he said, would enable regulators to identify financially vulnerable insurers at an earlier stage, strengthen oversight, and promote better governance across the industry.

Mir Nadia Nivin also underscored the strategic importance of insurance in Bangladesh, describing it as a disaster-prone country where effective risk protection is vital for individuals, businesses and communities. In this context, he called for the introduction of microinsurance products to extend financial protection to lower-income households and vulnerable groups. Expanding service delivery channels, he added, would also help improve access to insurance services across the country.

The seminar’s chief guest was Professor Dr Rashed Al Mahmud Titumir, Adviser to the Ministry of Finance and Planning. Special guests included Bangladesh Insurance Association (BIA) President Sayeed Ahmed and Bangladesh Insurance Forum (BIF) President BM Yusuf Ali, alongside other senior representatives from the insurance industry.

The discussion reflected growing recognition that meaningful reform will require coordinated action by regulators, insurers and policymakers. Industry stakeholders at the event agreed that improving governance, ensuring prompt settlement of claims and widening insurance coverage are essential steps towards building a stronger and more resilient insurance sector capable of supporting Bangladesh’s long-term socio-economic development.