The Insurance Development and Regulatory Authority (IDRA) has paid Tk 14.51 crore in insurance claims to 2,549 customers by selling assets held by seven financially distressed life insurance companies, in an effort to address long-standing unpaid claims and restore confidence in the sector.
The payments form part of a broader initiative to settle claims owed by insurance companies facing serious financial difficulties. According to IDRA, proceeds from the sale of land, government savings certificates and other assets are being channelled towards outstanding claims.
The regulator said the proceeds are being kept in separate bank accounts under its supervision. Payments are then being made to eligible policyholders according to established procedures, with older claims being given priority.
IDRA Chairman Mir Nadia Nivin recently said the authority had initially undertaken measures to settle claims involving seven to eight financially weak insurance companies. Assets being considered for mobilisation include land, fixed deposits, government bonds and other investments. Some assets have already been sold, while the disposal of others is under way.
Under the arrangement, money raised through asset sales will be deposited into separate accounts maintained in the names of the respective insurance companies. The funds will subsequently be distributed among policyholders in phases, prioritising older outstanding claims.
The latest initiative comes against the backdrop of a much wider claims-payment problem across Bangladesh’s insurance industry. According to the regulator’s latest figures, claims involving around 1.2 million policyholders remain unpaid. As many as 32 insurance companies are facing difficulties in settling outstanding claims, while the total value of unpaid claims had risen to around Tk 4,403 crore by 2025.
The performance of the life insurance segment also highlights the scale of the challenge. In 2024, life insurers faced total claims of around Tk 13,056 crore, of which Tk 8,609.50 crore was paid. This represented a settlement rate of 65.94 per cent. The rate edged up slightly to 66.54 per cent in 2025.
The general insurance segment recorded a considerably weaker performance. Against claims totalling around Tk 4,322 crore in 2024, insurers paid only Tk 1,333 crore, resulting in a settlement rate of 30.84 per cent. The rate declined further to 25 per cent in 2025.
IDRA has attributed part of the wider confidence problem to the prolonged failure of some insurers to honour claims. Timely settlement of legitimate claims is therefore being treated as a key element in rebuilding public confidence in insurance.
The regulator is also preparing measures to strengthen oversight of insurance companies. A risk-based supervision system is planned, under which insurers would be monitored according to the level of financial risk they pose. The approach is intended to help identify vulnerable institutions earlier and allow regulatory intervention before financial problems become more severe.
Another proposed measure is the introduction of a unique identification number for every insurance policy. Such a system would allow policy and premium-related information to be maintained more systematically and could improve transparency in the handling of customer records.
IDRA has also reported discrepancies between actual information and financial statements submitted by some insurance companies. Allegations have additionally emerged over the use of undisclosed or concealed databases by certain insurers. To address such irregularities, the regulator has instructed companies to integrate their information systems within a specified timeframe. Failure to comply could result in legal action.
The settlement of Tk 14.51 crore in claims represents a direct effort to return money to customers who have waited for their dues. But the figures on unpaid claims show that the industry still faces a much larger task. Alongside asset sales, effective financial supervision, accurate reporting and stronger information management will be necessary if insurers are to improve their ability to meet obligations and rebuild policyholders’ trust.
