Part one: Who Provides Insurance?

1.0 Insurance Practice in Bangladesh

1.1 History
After independence of Bangladesh, all types of insurance business operating then were
nationalized by dint of Presidential Order no.95. And government brought the companies under
the umbrella of five insurance corporations namely-

JatiyaBima Corporation (National Insurance Corporation)

Teesta Bima Corporation (Teesta Insurance Corporation)
KarnaphuliBima Corporation (Karnaphuli Insurance Corporation)
RupsaJibonBima Corporation ( Rupsa Life Insurance Corporation)
SurmaJibonBima Corporation ( Surma Life Insurance Corporation)

The JatiyaBima Corporation was the regulatory body to supervise and control the activities of the
other insurance corporations. The main objective of nationalizing and forming only of four
th
insurance corporations was to encourage competition even under a nationalized system. On 14
July, 1973 the Insurance Company Act 1973 was enacted under which the previous five
corporations were abolished and the following two corporations were established:

SadharanBima Corporation for General Insurance

JibonBima Corporation for Life Insurance

In 1984, under the Insurance Amendment Ordinance 1984, regime of private insurance
companies began in Bangladesh. This resulted in a considerable growth of premium incomes,
competition, improvement in services and proliferation of newer types of business in wider fields
untapped.

1.2 Recent Developments

Just after the permission of private insurance companies, supervisory role was transferred to
Ministry of Finance from Ministry of Commerce. In 2010, two new laws were passed. These are
Insurance companies act 2010 and Insurance Development and Regulatory Authority Act 2010.
A regulatory body was the dire need and it came into existence under insurance development and
regulatory authority act 2010, named Insurance Development and Regulatory Authority
(IDRA). It focuses on establishing a well structured and strong insurance industry, securing the
interest of the policy holders and stake holders, regulating and supervising the industry up to the
mark and ensuring the proper growth of the industry and resolving the concerns related thereto.
As part of its promise, so far different rules, regulations, policies are developed and enacted.
Among these insurance brokers and agents licensing, establishment of braches, licensing fee,
appointment and dismissal of Chief Executive Officer (CEO), inspection and audit etc rules and
national insurance policy 2014 are notable.

1.3 Insurance Companies in Bangladesh

At present, there are 77 insurance companies in total (46 general and 31 life insurance)
operating in compliance of the insurance act. Of the companies only two are government
insurance companies. ShadharonBima Corporation is the governments general insurance
company and JibonBima Corporation is the governments life insurance company. The other
75 companies are in the private sector. There are 45 general insurance companies and 30 are
life insurance companies. The only foreign private life insurance company in the private
sector is MetLife.

Table 1.1: List of Insurance Companies in Bangladesh

General Insurance Companies

Life Insurance Companies

Public Sector

Insurance Companies

1.Agrani Insurance Co. Ltd.

1.MetLife Ins. Co.(Foreign)

1. Sadharan Bima Corporation

2.Asia Insurance Ltd.

2.Baira Life Ins. Co. Ltd.

2. Jiban Bima Corporation

3.Asia Pacific Gen Insurance Co. Ltd.

3.Delta Life Ins. Co. Ltd.

4.Bangladesh Co-operatives Ins. Ltd.

4.Fareast Islami Life Ins. Co. Ltd.

5.Bangladesh General Insurance Co. Ltd.

5.Golden Life Ins. Ltd.

6.Bangladesh National Ins. Co. Ltd.

6.Homeland Life Ins. Co. Ltd.

7.Central Insurance Co. Ltd.

7.Meghna Life Ins. Co. Ltd.

8.City Gen. Insurance Co. Ltd.

8.National Life Ins. Co. Ltd.

9.Continental Insurance Ltd.

9.Padma Islami Life Ins. Co. Ltd.

10.Crystal Insurance Co. Ltd.

10.Pragati Life Ins. Ltd.

11.Desh Gen. Ins. Co. Ltd.

11.Prime Islami Life Ins. Co. Ltd.

12.Eastern Insurance Co. Ltd.

12.Progressive Life Ins. Co. Ltd.

13.Eastland Insurance Co. Ltd.

13.Rupali Life Ins. Co. Ltd.

14.Express Insurance Ltd.

14.Sandhani Life Ins. Co. Ltd.

15.Federal Insurance Co. Ltd.

15.Sunflower Life Ins. Co. Ltd.

16.Global Insurance Ltd.

16.Sunlife Ins. Co. Ltd.

17.Green Delta Ins. Co. Ltd.

17.Zenith Islami Life Ins. Ltd.

18.Islami Commercial Ins. Co. Ltd.

18.Mercantile Islami Life Ins. Ltd.

19.Islami Ins. Bangladesh Ltd.

19.NRB Global Life Ins. Co. Ltd.

20.Janata Ins. Co. Ltd.

20.Guardian Life Ins. Ltd.

21.Karnaphuli Ins. Co. Ltd.

21.Chartered Life Ins. Co. Ltd.

22.Meghna Ins. Co. Ltd.

22.Best Life Ins. Co. Ltd.

23.Mercantile Ins. Co. Ltd.

23.Popular Life Ins Co. Ltd.

24.Nitol Ins. Co. Ltd.

24.Protective Islami Life Ins. Co. Ltd.

25.Northern Gen. Ins. Co. Ltd.

25.Sonali Life Ins. Co. Ltd.

26.Peoples Ins. Co. Ltd.

26.Sawdesh Life Ins. Co. Ltd.

27.Phoenix Ins. Co. Ltd.

27.Diamond Life Ins. Co. Ltd.

28.Pioneer Ins. Co. Ltd.

28.Alpha Islami Life Ins. Ltd.

29.Pragati Insurance Ltd.

29.Trust Islami Life Ins. Co. Ltd.

30.Paramount Ins. Co. Ltd.

30.Jamuna Life Ins. Ltd.

31.Prime Insurance Co. Ltd.

32.Provati Insurance Co. Ltd.

33.Purabi Gen Ins. Co. Ltd.

34.Reliance Insurance Ltd.

35.Republic Insurance Co. Ltd.

36.Rupali Insurance Co. Ltd.

37.Sonar Bangla Ins. Co. Ltd.

38.South Asia Ins. Co. Ltd.

39.Standard Insurance Ltd.

40.Takaful Islami Ins. Ltd.

41.Dhaka Insurance Ltd.

42.Union Insurance Co. Ltd.

43.United Insurance Co. Ltd.

44.Sena Kalyan Ins. Co. Ltd.

45.Sikder Insurance Co. Ltd.

Major Policies
There are only two types of companies (general and life) in Bangladesh. Policies are classified as
per company classification.

1.4.1 Life Insurance Policies

The following chart shows the major types of life insurance policies offered in Bangladesh.

Figure 1.1: Life insurance Policies in Bangladesh

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1.4.1.1 Ordinary Life Insurance

There are following illustrations-
Endowment assurance policy with/without profits
The most common and widely popular, this plan provides for a fixed sum at end of a
particular term or at earlier on death of the assured. The plan is available under both
options i.e. with profit and without profit.
Eligibility: 18-55 years
Coverage Amount: Minimum Tk. 30,000 and the highest amount is determined based on
the socio economic condition of the insured
Term: The policy term ranges 10 to 30 years

Term Policy
These are comparatively low cost plans. These plans provide for payment of sum assured
in case of premature death within the term or refund of all premiums paid at end of term.
Policies under the plan can be taken for a minimum term (6 to 10 years) as elected by
policy holder.
 Whole Life Policy
This simple scheme requires one to pay premiums up to 85 years or till his death. The sum
assured with accrued bonus is paid to the nominee after the death of the policy holder.

1.4.1.2 Group Insurance Policy

Group Insurance is an instrument for providing life insurance coverage (protection) to a number
of individuals under a single contract (policy) who are associated together for a common interest
other than insurance.

Eligibility: To purchase this policy, there must be a group of 15 members. And there must be a
legitimately organized body.

Term: Minimum term is 3 years and can be further extended up to 60 or retirement age of policy
holders.

1.4.1.3 Islami Insurance Policy

Islami insurance is known as Takaful. Under takaful the premium is divided into two parts
investment and tabarru fund. The investment fund is utilized under mudarabah contract. If the
policy holder dies before maturity s/he is compensated from tabarru fund. If insured lives till
maturity s/he gets the invested amount with profits earned.

1.4.1.4 Others
There are following types-
Pension Policy
Pension policy offers both life insurance and pension for life. This policy provides at least
ten years guarantee of receiving pension. If the policy holder dies within 10 years period
after starting to receive pension, his/her nominee will receive pension in remaining years.
If policy holder lives, he will receive pension till death.
Eligibility: Minimum entry age is 18 years and maximum is 55 years. At the beginning
of retirement the policy holder must be 50 to 60 years.
Coverage amount: Minimum Tk. 30,000 to maximum Tk. 100, 00,000
Term: 5-100 years
 Health Insurance Policy
Health insurance policy covers the expenses hospital accommodation, consultation fee,
medicine & accessories, medical investigations, surgical operation, ancillary services like
blood transfusion, ambulance service, and dressing etc. This service is available to
individuals; group insured members, people going abroad for work or travel. Coverage is
provided up to 65 years of age.

Micro Insurance
Micro insurance products product/plans designed to help the lower income people to save
their hard earned money along with the coverage of insurance. Sum assured ranges from
Tk. 6000 to Tk. 60,000. Term of the policy is given for 12 to 30 years. Full sum assured is
provided along with accrued bonus in case of premature death of the policy holder or at
the end the policy term.

1.4.2 General Insurance Policies

The following chart shows the major types of products.

Figure 1.2: General Insurance Policies in Bangladesh

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