In a significant move aimed at restoring trust in the country’s insurance sector, the government of Bangladesh is preparing major amendments to the Insurance Act 2010. The proposed changes come in response to a series of high-profile scandals and are intended to protect policyholders’ interests, prevent corruption, and eliminate family domination in the management of insurance companies.
Key reforms in the draft include stricter rules on board appointments, restrictions on family ownership, and provisions for refunding customers’ money by selling off assets of bankrupt or failed insurance firms. The draft ordinance has been published on the website of the Financial Institutions Division under the Ministry of Finance, seeking public feedback.
Officials involved in the reform process stated that the final version of the ordinance will be prepared after consulting with stakeholders. The current Insurance Act of 2010 lacks critical provisions, such as the ability to dissolve a company’s board, remove top executives, or appoint a receiver to compensate policyholders in cases of fraud or bankruptcy. Additionally, it does not limit how many family members can serve on the board or how long they can hold those positions.
These long-overdue reforms are expected to bring about a fundamental shift in governance and accountability within the insurance industry in Bangladesh.