The life insurance products that are most popular in Bangladesh
Endowment is the most popular life insurance plan in Bangladesh as it offers a life cover and fixed returns and allows policyholders to make their loved ones financially secure and attain financial and other goals.
Besides, plans based on education and savings schemes have also received traction among customers.
Top insurance companies like MetLife Bangladesh, Pragati Life Insurance and National Life Insurance Company sell these plans along with other products.
MetLife's most popular policies include MetLife 3 Payment Plan (M3PP), MetLife Depositors Protection Scheme (MDPS), My Child's Education Protection Plan (MCEPP), and Endowment.
M3PP provides financial benefits in three stages and MDPS offers customers an opportunity to combine savings with life insurance benefits.
The endowment policy enables customers to provide an extensive safety net in the case of future unfortunate events while MCEPP enables policy-holders to save for children's higher education.
Additionally, endowment policies are tailored to give protection against future financial uncertainties. It gives a safety net for families in the event of a policyholder's death, disability, or accident.
"The popularity of these products stems from the flexibility of tailoring plans in line with customers' current financial capacity and future needs," said Ala Ahmad, chief executive officer of MetLife Bangladesh.
The products also come up with the option to add extra coverage for specific diseases and hospital stays, and the assurance to receive claims without any delays or hassles, he said.
"These policies are designed to provide customers with the benefit of accumulating funds to support their priorities. Besides, they extend insurance coverage during unforeseen events like death, disability, and accidents."
Pragati Life offers 29 insurance products.
"Our endowment policies that have savings components are the most popular. Our insurance plans on education and pension are also quite popular," said Md Jalalul Azim, managing director of Pragati Life Insurance.
"The flexibility of these insurance products is a key factor for their popularity."
He said if an individual buys a 12-year policy, he or she will get a certain percentage of money every two years. After the tenure, the whole amount will be returned with the bonus.
In the case of deaths, the nominee will get the full amount of the insured money.
Pragati Life Insurance's deposit pension scheme gives policyholders a lump sum at the end of the tenure.
Azim said products like health insurance have huge potential in Bangladesh, a country where insurance penetration is one of the lowest in the world.
He said term insurance, which provides a death benefit that pays the beneficiaries of policyholders throughout a specified period of time, yields higher return although the premium is low.
"So, it has the potential to become popular."
Kazim Uddin, CEO of National Life Insurance Company Limited, said among its products, the most popular plan is anticipated endowment insurance.
The sum insured is partially available in three instalments for the entire term, he added.
The fund can be used to invest in profitable activities, initiate a new business, buy a house, or pay for children's education and marriage.
Kazim said monthly savings schemes are also becoming popular.
If the insured survives the term, the entire amount along with the bonus earned is paid as a lump sum. If the policyholder dies, the amount is handed to the nominee.
At present, there are 35 life insurance and 46 non-life insurance companies in Bangladesh, with around 17.11 million people currently under insurance coverage.
The insurance penetration rate, which is measured as a percentage of total premiums collected to a country's gross domestic product, is 0.46 percent in Bangladesh whereas it stands at 4.2 percent in India and 0.91 percent in Pakistan.