B Mirror Desk : The insurance industry’s premium collection growth dropped from 9.1% in 2023 to a three-year low of 7.3% by the end of 2024. This decline is attributed to the industry’s challenges in gaining the trust of customers in the face of persistent economic volatility. According to the Insurance Development and Regulatory Authority (IDRA), the insurance industry’s overall premium revenues increased from Tk17,484 crore in 2023 to Tk18,768 crore in 2024. Life insurers collected Tk12,266 crore in 2024, a tiny decrease from Tk12,273 crore the year before, according to the life insurance industry.
On the other hand, premium collections increased to Tk6,502 crore in 2024 from Tk5,953 crore in 2023, indicating expansion in the non-life insurance market. According to industry analysts, the dollar issue prevented many businesses from obtaining Letters of Credit (LCs) last year, with the exception of necessities. The banking sector, on which the non-life insurance industry depends largely, had difficulties of its own last year, which had a negative effect on premium collections in that market. The poor circumstances also made it difficult for life insurance businesses to collect premiums; many had trouble luring in new customers, and several of their current clients were unable to make premium payments during these hard times.
Nevertheless, a few companies managed to perform well despite the uncertainties. In 2024, MetLife Bangladesh reported a premium collection of Tk3,300 crore, the highest among all life insurance providers in the country for that year. Ala Ahmad, the CEO of MetLife Bangladesh, shared with Media that the insurance sector in Bangladesh, like many others, is experiencing the impact of wider economic challenges. He emphasized that although overall growth has decelerated, a significant segment of the Bangladeshi population is still uninsured. Nevertheless, the gradual increase in premium collections, albeit at a reduced pace, indicates a growing awareness and interest in financial security.
Ahmad noted, ‘MetLife’s premium collection surpassing Tk3,300 crore demonstrates robust customer confidence. We have continually invested in digital solutions to facilitate easier and more accessible premium payments, with over 70% of our premiums currently being paid digitally.’ In 2024, National Life Insurance Company reported a premium collection of Tk2,102 crore, reflecting a 13% increase from Tk1,860 crore in 2023. Md Kazim Uddin, CEO of National Life Insurance Company, mentioned to Media that the primary challenge in the life insurance industry is the lack of client trust. Companies that have successfully addressed this issue are thriving.
Delays in claim settlements can lead to a trust deficit that affects other policyholders. He affirmed that National Life is dedicated to timely claim settlements, having remained proactive in fulfilling its obligations even during the Covid-19 pandemic. Addressing client concerns at the grassroots level has been a strategic priority for them. ‘Whenever we successfully settled a claim promptly, we attracted multiple new clients, which has eased our premium collection process, even in challenging times,’ he added. Khawja Manzer Nadeem, Managing Director of United Insurance, noted that the non-life insurance sector struggled last year due to the dollar crisis and a significant drop in Letter of Credit (LC) openings nationwide.
He observed that during a period of political instability, the marine insurance sector saw a decline of approximately 30%. He further mentioned that had the situation remained stable, there would have been significant growth opportunities in the non-life insurance market. Md Solaiman, the deputy director and spokesperson for IDRA, informed TBS that the regulatory body has investigated the matter and has formally requested action plans from six companies that have not sufficiently compensated policyholders. He noted that many of these insurers have policies that have matured for an extended period without resolution. In response, IDRA has mandated these companies to present a three-month plan for settling claims, detailing how they will manage their outstanding obligations. Solaiman cautioned that failure to execute these plans will result in IDRA taking more stringent measures to ensure policyholders receive their due payments.
Fareast Islami Life Insurance, Baira Life Insurance, Golden Life Insurance, Sunlife Insurance, Sunflower Life Insurance, and Padma Islami Life Insurance are the six firms that are engaged. IDRA has asked each business to present a detailed plan that outlines their ability to make payments within the allotted three months and discloses any financial issues that would prevent them from doing so on time. Solaiman noted that the state-owned reinsurer Sadharan Bima Corporation’s (SBC) inability to promptly satisfy their portion of claims is one of the main reasons given by businesses for settlement delays. As such, a significant portion of claims cannot be settled by insurers on their own. He continued by saying that SBC has already been informed about this problem by IDRA, and that the company’s new leadership is making every effort to close the gap.
Even though life insurance companies routinely collect premiums, some—especially the six that IDRA identified—have had difficulty promptly resolving policyholder claims.
