The Financial Institutions Division (FID) has proposed removing a provision from the Insurance Corporation Act 2019, which mandates that non-life insurers in Bangladesh cede half of their reinsurance business to the state-owned Sadharan Bima Corporation (SBC), as reported by the Financial Express.
This proposal comes after recommendations from the Insurance Development and Regulatory Authority (IDRA), which pointed to the sector’s low claim settlement ratios as a significant concern.
According to data from IDRA, the country’s non-life insurance sector had a claim settlement ratio of just 35.54% as of December 2023.