Business bodies slam insurance regulator

AK Azad, president of the Federation of Bangladesh Chambers of Commerce and Industry, briefs journalists after a meeting at Dhaka Club yesterday. Sheikh Kabir Hossain, president of Bangladesh Insurance Association, is also seen.Photo: STAR

Business bodies yesterday came down heavily on the chief of the Insurance Development and Regulatory Authority (IDRA), accusing him of being an anti-business element.
“He can't run the regulatory body,” said AK Azad, president of the Federation of Bangladesh Chambers of Commerce and Industry (FBCCI), after a meeting at Dhaka Club.
The meeting was convened to discuss issues pertaining to the insurance sector. Recently, the IDRA issued a number of circulars that included barring an insurance director from becoming a director in other finance companies, imposing penalties for irregularities and increasing fire and marine tariff rates.
“We'll take up the issues with the finance minister and if necessary, with the prime minister,” said Sheikh Kabir Hossain, president of Bangladesh Insurance Association (BIA).
Presidents of Bangladesh Garment Manufacturers and Exporters Association, Bangladesh Textile Mills Association, Dhaka Chamber of Commerce and Industry, Dhaka Stock Exchange and the BIA and chairmen of different insurance companies attended the meeting. Four former FBCCI presidents were also present.
The FBCCI and BIA presidents briefed journalists after the meeting.
The other IDRA decisions that irked businesses include prohibition of directors and dependents' business with their respective insurance companies and providing details of all policies/cover notes and endorsements issued to their directors and their dependants.
Businessmen unanimously agreed that the IDRA should immediately postpone all the circulars it has issued for the sake of the insurance industry.
“These orders have affected the insurance industry and we want those to be postponed immediately,” said Hossain.
The FBCCI president said the economy is already facing several challenges and the IDRA's decisions are making matters worse.
Azad also opposed barring an insurance director from being a director in other finance companies, saying it was not discussed with the trade bodies.
“We'll request the government to bring amendments in this regard,” he said.
Though insurance laws prohibited an insurance director from becoming the same in other finance companies, the Banking Companies Act 1991 and Finance Companies Act 1993 allows it.
Shefaque Ahmed, chairman of the IDRA, however denied the allegations.
“The IDRA has done everything according to laws. The circulars were issued recently to protect the interest of the policyholders, shareholders and the overall industry,” said Ahmed, also an actuary.
“We didn't raise the fire and marine tariff rates. We've ordered companies not to give discounts and rebates that are generally enjoyed by the influential groups,” he said.
There are 62 insurance companies in Bangladesh, of which, 44 are general and 18 life insurers.