Insurance sector has lots of potential to grow

Lack of discipline one of the key challenges, Insurance Association President Sheikh Kabir Hossain tells the Daily Sun

Anisul Islam Noor

1 March, 2021 12:00 AM printer

Insurance sector has lots of potential to grow

“When the insurance sector gets stronger, so does the economy of the country. This was first realised by Father of the Nation Bangabandhu Sheikh Mujibur Rahman. So he started to reform the insurance sector immediately after the country’s independence,” said Sheikh Kabir Hossain, President of Bangladesh Insurance Association (BIA).

He was talking to the Daily Sun in an exclusive interview on the occasion of National Insurance Day.

About the implication of the observance of the Insurance Day, he said it has immense significance for the efforts to improve discipline in the industry.

“The Prime Minister took initiatives to develop the insurance sector. No other government has played any role in the development of the insurance sector. The present government has passed the insurance law and formed the regulatory body of the insurance sector,” said the president of the BIA, a platform of 79 life and non-life insurance firms in Bangladesh.

"Observance of such a day at the national level will help generate more interest of the policyholders, general investors and insurers."

"Prime Minister Sheikh Hasina is a member of the insurance family, so the existing indiscipline in the industry will not linger any further," said Sheikh Kabir Hossain, who is also chairman of the non-life Sonar Bangla Insurance Company.

He said during the 1960 martial law across the country (then East Pakistan), Bangabandhu Sheikh Mujibur Rahman joined the Alpha Insurance Company. The Father of the Nation joined the insurance company as the chief of business promotion. He joined the company on 1 March received his first salary from the insurer in April 1960. 

Close relatives of Bangabandhu said he used to sit at the Alpha Insurance's Bangabandhu Avenue office. This building now belongs to the state-owned Sadharan Bima Corporation (SBC).

Sheikh Kabir Hossain said the insurance sector remains neglected for long, although the industry started its journey here in 1938.

He along with other members of the association had been trying to observe such a National Day in recognition of Bangabandhu Sheikh Mujibur Rahman's contribution to the industry.

"We had met Prime Minister Sheikh Hasina in 1996 at a time when she first assumed power and she then had shown keen interest in the sector".

"We had proposed then (1996) to declare a national day".

Kabir Hossain said the long-standing persuasion, at last, came to fruition in 2019 when the Cabinet approved the notion to observe 1 March as the National Insurance Day.

When asked how the reinsurance sector can be developed, Kabir Hossain said Bangladesh now needs t to introduce re-insurance companies to take the sector to a new height.

“Currently there is only the state-owned non-life insurer --- Sadharan Bima Corporation (SBC).”

"We are re-insuring with foreign re-insurance companies at the expense of huge foreign exchanges. We can develop such a re-insurance hub in the country through public and private partnership," he said.

On the low penetration of insurance in the country, he said this is a neglected area and there is a lack of discipline in the industry to some extent. "We believe such observance of the day regularly will make the people more aware of the insurance sector.”

Besides, more risk coverage areas are needed. "We have very limited areas where we work. We think this should have been expanded."

"There are many large buildings that lack insurance coverage, if we can bring them under the coverage, the insurance penetration will rise," he added.