Global Insurance Ignores ₤55.5 Billion Reinsurance Requirement

Global Insurance PLC has reportedly failed to reinsure re-insurable policies worth approximately 55.5 billion taka, flouting statutory obligations and exposing both the company and its clients to significant financial risk. Under the Insurance Act 2010, companies are legally required to secure reinsurance for all eligible policies, and failure to comply can lead to suspension or cancellation of their licence. The omission has also deprived the state-owned General Insurance Corporation (GIC) of substantial premium revenue.

A special audit of Global Insurance’s 2022 operations was commissioned by the Insurance Development and Regulatory Authority (IDRA) and conducted by UHY Saiful Shamsul Alam & Co. The audit examined 3,022 policies issued across seven branch offices. Of these, 1,249 policies required reinsurance, yet the company neglected to reinsure 1,012 policies—approximately 81% of all re-insurable policies.

The total insured value of unreinsured policies reached 2,598.12 crore taka, with 555.19 crore taka classified as re-insurable. The audit report’s annex includes detailed information on 83 representative policies that were eligible for reinsurance but remained uncovered.

Sample Unreinsured Policies

IDRA regulations, under Section 10(1)(j) of the Insurance Act 2010, empower the authority to suspend or revoke licences of companies that fail to maintain adequate reinsurance. A hearing addressing 32 allegations against Global Insurance, including the failure to reinsure, was held on 23 July 2025. While violations were confirmed, no fines or disciplinary actions were imposed. The IDRA law division recommended the company be cautioned and monitored to ensure compliance.

Experts warn that neglecting reinsurance obligations can jeopardise an insurer’s solvency, particularly in the event of large-scale claims, potentially putting customers’ compensation at risk. Historical precedent underscores the seriousness: in 2015, Standard Insurance Limited faced licence suspension for failing to reinsure policies worth 46.33 crore taka.

Attempts to obtain a statement from Global Insurance PLC were initially unsuccessful. Despite follow-up promises, the company has provided no further comment on the issue.