Insurers short on skills
Nasir A Choudhury
Professional manpower is scarce in the country's growing insurance industry when over 60 companies have sprung up in the private sector in a span of 22 years.
This is what Nasir A Choudhury, a doyen in Bangladesh's insurance business, spelt out his experience on completion of his 50 years of successful career.
“The country needs insurance professionals who can assess the risks of the business properly,” said Choudhury.
Half a century is a long time and very few people succeed in staying in any business for such a period. This is indeed a rare landmark not only for him, but also for the whole industry.
Choudhury, now the managing director and chief executive officer of Green Delta Insurance Company Limited, will turn 74 on December 1 and is still work-monger.
Looking back to early days, he said, “Insurance as a subject appeared to be dull at the very beginning. I tried to switch over to other professions. But a one-year training in London in 1961 had changed everything. Insurance remains a part of my life till today.”
“I was lucky to get a one-year-long training course on insurance in London. I was exposed there with the global insurance experts and that's changed my life,” Choudhury recalled, adding that a two-month training on re-insurance in 1962 had helped him gain expertise.
Starting his career as a trainee executive in the then state-owned Pakistan Insurance Corporation in September 24, 1958, the charismatic personality served in different positions. He was the general manager of Shadharan Bima Corporation, the state-run general insurer, but left his job in 1983 and joined a Hamburg-based textile equipment manufacturing company's Dhaka office.
After a brief exile from the insurance industry, the chance to return to his area came again in 1985 when the Bangladesh government allowed private sector insurance business.
“Some of my friends asked me to float a company. I was doubtful whether I would be able to lead a company or not,” Choudhury said. “Finally I agreed and got the registration for Green Delta Insurance Company in January 1986,” he went on.
Since then he has been heading Green Delta, a leading general insurance company. The insurance pioneer did not confine himself only to the insurance business. He diversified the business from housing loan provider to telecom.
Talking to The Daily Star on his long insurance career, he dwelt on the past, present and future of insurance business.
“Insurance business is changing everyday. It appears to be challenging,” Choudhury said, pointing to the fact that now people come to insure for their business interruptions.
The insurance doyen criticised successive governments for licencing so many companies in a limited market. “That has created an imbalance in the sector,” he observed.
Of the 60 private insurance companies, 43 are general and 17 life insurers. In addition, the government has two companies. The premium market for general companies is only around Tk 1,000 crore.
“The neighbouring Indian market is Rs 29,000 crore and only eight private companies are operating there,” Choudhury continued.
Different government permitted insurance licenses on political biasness, resulting in a lack in the required services for clients, the Green Delta chief said.
“If a company offers 60 percent commission, how it will make profit after its operational costs,” Nasir Choudhury questioned. Ultimately, these companies failed to settle claims, he added. “That has generated a negative perception about the insurance people,” he lamented.
On the new law on insurance, he is hopeful that things would change and help flourish the industry.
“Merger between the small companies can rectify the things in the industry,” he suggested. The new law that has already been approved by the Council of Advisers raised the paid-up capital for the insurance companies. Choudhury believes small companies would fail to comply with the new laws in terms of capital.
He believes insurance business has a bright prospect in Bangladesh. The premium of Green Delta was Tk 6.5 crore in 1986, but it reached Tk 110 crore in 2007. “That tells how the business is growing in Bangladesh,” the optimistic Choudhury added.
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