Bangladesh’s Insurance Development and Regulatory Authority (IDRA) has set an ambitious target to raise the industry’s claim settlement rate from 57 per cent, recorded in June, to at least 75 per cent. The regulatory drive comes as the nation’s insurance sector grapples with a staggering Tk 70 billion in unpaid claims.
Speaking at a special event hosted at the IDRA headquarters in Dilkusha on Monday, IDRA Chairman Mir Nadia Nivin outlined a two-pronged strategy designed to dismantle the chronic backlog and restore public confidence. The strategy focuses on holding direct governance review meetings with owners and chief executive officers to iron out compliance bottlenecks while placing financially distressed insurers under strict regulatory oversight. Although no definitive timeline was specified for achieving the 75 per cent threshold, Nivin emphasised that clearing legitimate dues remains her administration’s foremost priority since assuming office in July.
Monday’s event marked the second phase of a targeted settlement drive, distributing Tk 230.4 million in overdue claims to 5,868 policyholders across five life insurance companies. To finance these payouts, the regulator mobilised capital by liquidating company assets and encashing statutory security bonds.
Under the second-phase disbursements, Padma Islami Life Insurance settled Tk 120 million for 3,600 policyholders, while Homeland Life Insurance paid Tk 49.8 million to 1,145 claimants. Fareast Islami Life Insurance disbursed Tk 50 million to 580 policyholders, Sunflower Life Insurance provided Tk 5.53 million to 300 individuals, and Sunlife Insurance cleared Tk 5.01 million for 243 policyholders. This follow-up drive builds on the initial phase executed on 3 September, which saw Tk 145.1 million paid to 2,549 policyholders across seven life insurers, including Baira Life, Golden Life, and Progressive Life.
Of the 82 insurance firms operating in Bangladesh, roughly eight life insurers face severe liquidity crises, severely damaging the broader industry’s reputation. Nivin reassured stakeholders that while these distressed entities are subject to tailored interventions, IDRA is adopting a holistic approach that includes close supervision of moderately troubled firms to accelerate claim processing nationwide.
Attending the event, Finance and Planning Minister Amir Khosru Mahmud Chowdhury commended IDRA’s governance reforms and its move towards risk-based supervision. He highlighted that protecting policyholder rights and enhancing complaint resolution mechanisms are essential steps toward building a robust, transparent, and customer-centric insurance market capable of supporting the national economy.
