Insurance companies unable to pay claims due to misappropriation of money and not proper investment – IDRA Chairman

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Insurance Development and Regulatory Authority (IDRA) chairman Mohammad Zainul Bari has commented that financial crisis has arisen in insurance companies due to misappropriation of money and improper investment of resources and excessive spending. The Chairman of IDRA said these things in response to the questions of journalists at the ‘CMJF Talk’ program organized by the Capital Market Journalists’ Forum at Paltan in the capital on Wednesday (March 15). CMJF general secretary Abu Ali presided over the program and the organization’s president Ziaur Rahman presided over the event. IDRA Chairman Mohammad Zainul Bari said that only premium income was generated in the first 10 years of the establishment of the companies. During this period additional expenses were incurred. No proper investment. As a result, a financial crisis has developed. Paying attention to insurance claims. We have called the board of directors of companies that are unable to pay insurance claims. I give them a deadline. Usually we would call the chief executives of the companies that were having problems. But now we are talking directly to the directors. He said that even though the land was sold to the insurance companies, their customers were urged to pay the insurance claims. In this case, permission has also been given to sell the land. But this permission is being given with a little scrutiny. If an insurance company does not comply with the order to pay the claim, the board of the insurance company will be dissolved if necessary. IDRA Chairman said, We have formed a complaint cell in view of non-payment of insurance claims. A hotline has also been launched. We are constantly receiving calls, requests, mails and various complaints. In view of this, we have spoken to 7 companies. I have asked those who spend more to reduce their expenses. Besides, I have asked to give the plans regarding the insurance policies that will expire in three years till 2025. Thus we continue to try. Mohammad Zainul Bari said, we will be able to closely monitor the insurance sector if it is digitized. If this happens, the activities of the companies will become automation. Then human contact will be further reduced. This will make it easier for insurance customers to pay their claims. As controllers we can control easily. We can see about funds and finances. I can easily monitor the state of the institutions, what they are doing. He also said that digitization is very important for the development of the insurance sector. The new generation is used to buying various products including food and clothing online. If insurance products can also be bought online, then interest among them will increase. Moreover, if it is digitized, the customer can check whether his premium has been deposited or not, what is the status of the policy etc. As a result of this, on the one hand, the confidence of the customers will increase, on the other hand, the opportunities for irregularities and corruption will also decrease. Regarding the statement given by the Prime Minister regarding an insurance claim of Tk 40 crore by the General Insurance Corporation on the occasion of National Insurance Day, the IDRA Chairman said, “We are working on the irregularity of Tk 40 crore insurance claim.” On the first working day after the closure of the insurance day, we had a meeting regarding the payment of the insurance claim of Rs.40 crores. I have made a committee to check it. The committee is working. Mohammad Zainul Bari said, we have taken the initiative to make it timely by amending the insurance law. While implementing this law, we have seen that there are inconsistencies in some places, there are various ambiguities. There are so many regulations that are said to be completely unworkable. Therefore, it is necessary to amend the Insurance Act. They have already started drafting the amendment. Regarding the biggest challenge in the development of the insurance sector, IDRA Chairman said that the insurance sector has huge potential. But the problem is not less. Among these, non-compliance with compliance issues is the biggest problem. Due to lack of compliance for a long time, irregularities and corruption have taken root in many companies; There have been instances of waste, misuse, and even embezzlement of customer and company money. We have taken a strict stand to resolve this issue.

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