The Insurance Development and Regulatory Authority (IDRA) has allowed 6 listed banks to start bancassurance.
The banks are City Bank, Dutch-Bangla Bank, BRAC Bank, AB Bank, Eastern Bank (EBL), and Mutual Trust Bank (MTB).
Citibank has signed an agreement with Guardian Life Insurance as a corporate agent to launch Bancassurance. Eastern Bank has signed a corporate agent agreement with MetLife and Green Delta Insurance.
BRAC Bank has signed corporate agreements with MetLife and Green Delta, Dutch Bangla Bank with Guardian and Pragati Life, Mutual Trust Bank with Guardian Life, Pragati Life and Green Delta Insurance. Prime Bank has signed a corporate agreement with National Life.
The agreements have been signed following the guidelines of the Bangladesh Bank and Insurance Development and Regulatory Authority (IDRA). Some of these banks have started selling insurance services, but some have not yet.
BRAC Bank has signed corporate agreements with MetLife and Green Delta, Dutch Bangla Bank with Guardian and Pragati Life, Mutual Trust Bank with Guardian Life, Pragati Life and Green Delta Insurance. Prime Bank has signed a corporate agreement with National Life.
The agreements have been signed following the guidelines of the Bangladesh Bank and Insurance Development and Regulatory Authority (IDRA). Some of these banks have started selling insurance services, but some have not yet.
Insurance companies will be able to promote their products through banks by sharing commissions. Both parties will benefit from this.
A bank has to get permission from the central bank to sell insurance products and services as a corporate agent. After getting the approval, the bank has to establish a separate bancassurance unit or wing.
According to the policy, the bank cannot compel any customer to take the insurance product, nor can the insurance company give any incentive other than the declared price to encourage the customer to purchase the insurance product. Banks interested in introducing bancassurance must earn profits for three consecutive years.
A bank can sell a maximum of three life insurance and three general insurance products and services at the same time. Only those banks whose actual non-performing loans are less than 5 percent can join this service. In that case, the ratio of risk-adjusted assets (CRAR) of commercial banks should be 12 and a half percent.
According to Basel-3, banks whose credit rating or credit rating is below grade 2 given by Bangladesh
