B Mirror Report: The government is taking a firm stand in an effort to eradicate long-standing fraud, irregularities, and harassment of customers in the nation’s insurance industry. Significant amendments are being made to the Insurance Act, 2010 to further strengthen the regulatory authority, the Insurance Development and Regulatory Authority (IDRA).
With these modifications, the authority will acquire unique powers for the first time, including the ability to examine records from insurance companies and confiscate property. The amended law’s draft has already been delivered to the Ministry of Finance and is currently awaiting final clearance from the Ministry of Law.
According to the proposed draft, if a company is accused of settling claims for excessive or insufficient amounts, illegal commission transactions, or embezzlement, IDRA will be able to launch a direct investigation. If the chairman of the authority has reasonable suspicion, he can authorize an official to conduct searches and seize documents.
The designated officer will, if necessary, have the power to enter premises, break into lockers or cabinets, seize documents, and make copies. Police assistance may be sought in this process, and the police will be obligated to provide it. Strict action can also be taken against anyone who withholds information or refuses to cooperate during the investigation.
The new provisions also state that during investigations, individuals may be questioned under oath, and their statements will be admissible as evidence in court. However, safeguards are in place to prevent abuse of power.
For instance, seized documents cannot generally be kept for more than 180 days and must be returned within 30 days after the investigation is completed. Additionally, affected individuals will have the right to appeal to the government. Foundations or affiliated organizations funded by insurance companies will also now fall under IDRA’s supervision.
IDRA Chairman Dr. Aslam Alam has said that after discussions with stakeholders, the draft is now at the ministry level. The primary objective is to establish good governance in the insurance sector and ensure the protection of customers’ money. Meanwhile, insurance policyholders like Sajjadul Islam say that they have spent years chasing their claims, and if the regulatory authority is strengthened, their hardships will decrease.
