Non-life insurance companies in Bangladesh have not been able to settle around 68% of the claims submitted in the year 2024. This has resulted in outstanding claims amounting to approximately BDT26,350m ($217m) by the end of the year.
This information is based on the unaudited data made available by 46 public and private non-life insurance companies to the country’s insurance regulator Insurance Development and Regulatory Authority (IDRA).
In 2024 the total claims in the non-life insurance sector stood at BDT35,829m, of which only about BDT14816m (41%) was paid. In 2023 the total claims submitted amounted to BDT3,8719m while only BDT1,2374m (32%) was settled.
IDRA has said that it will act against the companies with poor claim settlement rates. A governance review meeting with the directors of those companies will soon be convened.
Delays in claim settlements cause prolonged suffering for policyholders, many of whom face severe financial hardship due to unpaid compensation.
The insurance law mandates that claims be settled within 90 days, however, this rule is often not followed.
Insurance companies in their defence say that the Bangladesh’s domestic reinsurer Sadharan Bima Corporation (SBC) that reinsures country’s 50% non-life insurance business, delays in settling their share of the reinsured losses and this prevents insurers from paying policyholders on time. Some companies, however, do pay the claims on time from their own funds.
The primary insurers have said that the foreign reinsurance companies, that reinsurer the remaining 50% of the non-life business, usually settle claims promptly.
The SBC, however, says the delays often occur due to incomplete documentation and non-receipt of premiums in a timely manner from the insurers.
This information is based on the unaudited data made available by 46 public and private non-life insurance companies to the country’s insurance regulator Insurance Development and Regulatory Authority (IDRA).
In 2024 the total claims in the non-life insurance sector stood at BDT35,829m, of which only about BDT14816m (41%) was paid. In 2023 the total claims submitted amounted to BDT3,8719m while only BDT1,2374m (32%) was settled.
IDRA has said that it will act against the companies with poor claim settlement rates. A governance review meeting with the directors of those companies will soon be convened.
Delays in claim settlements cause prolonged suffering for policyholders, many of whom face severe financial hardship due to unpaid compensation.
The insurance law mandates that claims be settled within 90 days, however, this rule is often not followed.
Insurance companies in their defence say that the Bangladesh’s domestic reinsurer Sadharan Bima Corporation (SBC) that reinsures country’s 50% non-life insurance business, delays in settling their share of the reinsured losses and this prevents insurers from paying policyholders on time. Some companies, however, do pay the claims on time from their own funds.
The primary insurers have said that the foreign reinsurance companies, that reinsurer the remaining 50% of the non-life business, usually settle claims promptly.
The SBC, however, says the delays often occur due to incomplete documentation and non-receipt of premiums in a timely manner from the insurers.