Bangladesh’s life insurance sector presents a striking contrast of overall expansion alongside severe institutional distress. Comparative financial data from 2020 to 2025 reveals that while industry-wide revenue grew, at least thirteen life insurance companies experienced a simultaneous contraction in business volume and life fund reserves. Industry experts have likened this compounding decline to an untreated malignancy within the sector, warning that without swift intervention, the crisis could undermine public confidence across the broader financial landscape.
According to statistical reviews, total premium income across the life insurance sector rose from BDT 9,528 crore in 2020 to BDT 13,102 crore in 2025, marking an overall growth of BDT 3,574 crore. However, this national expansion was largely driven by well-managed entities such as National Life, Delta Life, Pragati Life, MetLife, and Sonali Life. In stark contrast, a cluster of troubled firms—including Fareast Islami Life, Padma Islami Life, Popular Life, Meghna Life, Rupali Life, Prime Islami Life, Homeland Life, Sunflower Life, Sun Life, Progressive Life, Golden Life, Baira Life, and Protective Life—suffered sharp financial declines.
The performance and fund contraction across the affected companies between 2020 and 2025 are outlined below:
| Insurance Company Name | 2020 Revenue (BDT Crore) | 2025 Revenue (BDT Crore) | 2020 Life Fund (BDT Crore) | 2025 Life Fund (BDT Crore) |
| Fareast Islami Life | 974 | 283 | 2,003 | -847 (Negative) |
| Popular Life | 591 | 501 | 1,752 | 1,492 |
| Meghna Life | 422 | 283 | 1,890 | 1,570 |
| Prime Islami Life | 414 | 388 | 837 | 744 |
| Rupali Life | 248 | 215 | 505 | 505 |
| Sunflower Life | 65 | 15 | 138 | 88 |
| Homeland Life | 101 | 9 | 261 | 168 |
| Golden Life | 24 | 17 | 261 | 168 |
| Padma Islami Life | 49 | 15 | 13 | -309 (Negative) |
| Baira Life | 4 | 2 | 66 | -65 (Negative) |
| Sun Life | 105 | 19 | 182 | 49 |
| Progressive Life | 42 | 30 | 273 | 69 |
| Protective Life | 39 | 31 | 10 | 1 |
The figures highlight a severe liquidity strain at Fareast Islami Life and Padma Islami Life, both of which saw their life funds turn negative—standing at minus BDT 847 crore and minus BDT 309 crore respectively. Newer entrants have also struggled; Protective Life saw its life fund plummet from BDT 10 crore to BDT 1 crore, threatening its ability to meet policyholder claims moving forward.
Sector analysts attribute the crisis to legacy mismanagement, reckless capital expenditure, and historical fraud. Executive officers from affected firms acknowledged that past embezzlement and uncoordinated capital investments—such as purchasing expensive real estate and vehicles—left several companies with insufficient liquid assets when long-term claims matured. Furthermore, significant institutional capital remains tied up in struggling banks and non-bank financial institutions, severely restricting liquidity.
Because life funds represent policyholders’ long-term savings, continuous depletion directly imperils solvency. With successful firms expanding under identical economic conditions, regulators face mounting pressure to conduct targeted audits and enforce structural reforms to protect policyholder assets before institutional failures spread further.
