The Insurance Development and Regulatory Authority (IDRA) has taken a policy decision to abolish agent commissions in the country’s non-life insurance sector. The decision will come into effect on 1 January 2025.

The decision was made on Tuesday (25 November) during a meeting held at IDRA’s headquarters with the participation of the Bangladesh Insurance Association (BIA) and chief executive officers of all non-life insurance companies. The information was disclosed in a letter signed by Md. Solaiman, Deputy Director of Non-Life Insurance Companies.

IDRA will soon issue a formal notification defining the directives and procedures for implementing the new decision.

The meeting decided that all non-life insurance companies must submit proposals to IDRA by 5 December to suspend the licenses of individual agents. Based on these proposals, IDRA will issue a notification setting the agent commission for the non-life insurance sector at zero percent.

After the notification is issued, IDRA will monitor whether any non-life insurance company is violating the directive concerning agent commissions.

The meeting also decided that due to IDRA’s shortage of manpower, the Bangladesh Insurance Association must assist in monitoring. For this purpose, BIA must form a vigilance team alongside IDRA. If any non-life insurance company violates the directive by providing agent commissions above the mandated zero percent, the BIA vigilance team will report it to IDRA. IDRA will then verify the matter and take action under the Insurance Act, 2010.