BSEC Expresses Deep Concern Over Insurers’ Audits

The Bangladesh Securities and Exchange Commission (BSEC) has voiced significant concern regarding the audit reports of 27 listed insurance companies for the 2024 financial year, highlighting potential implications for investor confidence, policyholder protection, and market transparency. The regulator underscored that these audit observations are far from routine and may point to elevated risks within corporate governance, financial reporting, and risk management processes.

According to BSEC’s Corporate Reporting Department, the commission conducted a detailed review of the audits and formally urged the Insurance Development and Regulatory Authority (IDRA) to consider necessary regulatory actions. The assessments revealed that auditors issued various forms of non-standard opinions, including adverse opinions, qualified opinions, emphasis of matter paragraphs, going concern warnings, and conclusions indicating material uncertainties.

BSEC emphasised that such audit findings are critical indicators, particularly the ‘going concern’ and ‘material uncertainty’ observations, which directly question the companies’ ability to continue operations and meet their obligations to policyholders and creditors. “These reports are a clear signal that certain insurers may be exposed to higher operational and financial risk,” the commission noted.

The 27 insurers under review span both life and non-life sectors, including prominent companies such as Asia Insurance, Asia Pacific General Insurance, Bangladesh General Insurance, Central Insurance, Continental Insurance, Delta Life Insurance, Dhaka Insurance, Eastern Insurance, Federal Insurance, Green Delta Insurance, Islami Commercial Insurance, Islami Insurance Bangladesh, Janata Insurance, Meghna Insurance, Northern Islami Insurance, Paramount Insurance, Phoenix Insurance, Prime Insurance, Republic Insurance, Rupali Insurance, Sonar Bangla Insurance, Sikder Insurance, Standard Insurance, Union Insurance, Popular Life Insurance, and Sun Life Insurance.

BSEC has instructed IDRA to examine the reports with due diligence and, where necessary, initiate special or forensic audits and implement corrective measures. Currently, Bangladesh hosts 82 insurance companies, of which 58 are listed on local stock exchanges. Industry analysts believe that coordinated regulatory actions by BSEC and IDRA will significantly influence perceptions of governance, risk management, and regulatory effectiveness among domestic and regional investors.

Market forecasts suggest that Bangladesh’s total gross premiums could reach approximately USD 15.56 billion in 2025, with life insurance contributing around USD 9.48 billion. The sector is expected to maintain an average annual growth rate of 4.02% between 2025 and 2029, potentially reaching USD 18.22 billion by the end of the forecast period.