A significant legal and financial confrontation is brewing in the Bangladeshi financial sector as insurance companies challenge a contentious directive from the Insurance Development and Regulatory Authority (IDRA). The regulator has ordered firms to pay additional sums for their 2026 registration renewals, despite the fact that these fees had already been settled under the prevailing statutory rates.
The Legislative Conflict
The crux of the dispute lies in the timing and legal basis of the IDRA’s demand. Under the Insurance Act 2010, insurance companies are required to apply for renewal by 30 November of the preceding year, with fees calculated based on the gross premium of the last audited financial year. Most firms had already completed this process by November 2025.
However, on 4 February 2026, the government issued a gazette notification amending the Insurance Business Registration Fee Rules 2012, followed by a directive from IDRA on 19 February demanding the “balance” of the newly increased fees. Legal experts and industry veterans argue that neither the Insurance Act 2010 nor the IDRA Act grants the regulator the authority to collect fees retrospectively or modify settled financial obligations based on post-facto amendments.
Escalating Costs for Insurers
The revised fee structure represents a dramatic increase in operational overheads for an industry already grappling with economic volatility.
| Effective Years | New Fee Rate (Per 1,000 BDT Gross Premium) | Previous Rate | Increase (%) |
| 2026 – 2028 | BDT 2.50 | BDT 1.00 | 150% |
| 2029 – 2031 | BDT 4.00 | BDT 1.00 | 300% |
| 2032 Onwards | BDT 5.00 | BDT 1.00 | 400% |
Industry Backlash and “Arbitrary” Decisions
The sudden hike is reportedly linked to the controversial “Duar Service Limited” SMS project. Following the July 2024 uprising, insurers refused to pay for this service. Critics allege that IDRA quintupled the registration fees as a secondary method to extract funds.
Brigadier General Md. Shafique Shamim, psc (Retd.), Secretary General of the Bangladesh Insurance Forum (BIF), stated that the decision should be reconsidered. “Registration for 2026 should be granted based on the rates paid in late 2025. If an increase is necessary, it should be implemented from 2027 to allow companies to adjust their budgets,” he remarked.
Echoing this sentiment, Imam Shaheen, CEO of Asia Insurance, noted that charging extra fees after the renewal deadline has passed is legally questionable. “We settled our 2026 dues in November 2025 based on 2024 premiums. Forcing an additional charge in February 2026 creates an accounting nightmare and places undue pressure on our expense ratios,” he explained.
Threats and Implications
Reports have emerged of IDRA officials allegedly telephoning CEOs, threatening to withhold registration certificates unless the “shortfall” is paid. Given that operating without a valid registration is illegal under Section 10 of the Insurance Act, firms find themselves in a coercive “Catch-22” situation.
The Bangladesh Insurance Association (BIA) is expected to hold formal talks with the regulator to resolve the impasse. Industry leaders warn that if the IDRA persists with this “arbitrary” retrospective enforcement, it may face a series of high-court challenges regarding its statutory jurisdiction.