Senior Reporter :
NN: Although banks and insurance are important in the financial sector, National Day is being celebrated only in the insurance sector.
How do you evaluate the matter as a chief executive of an insurance company?
Md. Kazim Uddin: It is definitely a matter of pride and honor.
Any national day is associated with the glory, dignity and honor of the country.
The Prime Minister Sheikh Hasina honored the insurance industry by declaring March 1 as National Insurance Day in memory of Bangabandhu Sheikh Mujibur Rahman.
I think the neglected insurance industry has reached to a respectable place.
And as a worker in this sector, the Insurance Day holds special importance for me.
NN: To what extent the actual reflection of the aim and purpose of insurance day is celebrated?
Md. Kazim Uddin: Insurance Day is a great honor and glory for the insurance sector.
Insurance companies have taken various steps on this day.
In particular, under the direction of IDRA and the Ministry of Finance, various activities including processions, distribution of leaflets, discussion meetings are being conducted to create awareness about insurance.
So I think, due to the observance of Insurance Day, there is a positive impact in this sector.
NN: To what extent has the general public’s confidence in the insurance industry increased compared to before?
Md. Kazim Uddin: The insurance companies used to collect premiums with handwritten receipts.
In some cases, this would have complicated customer service.
But now insurance companies are being given for premium payment digitally.
That is, as soon as the customer submits the premium, the SMS is going to his mobile phone.
IDRA also provides policy information to customers through SMS.
The customer can be sure about the deposit of his premium.
The rate of life insurance subscribers is very insignificant compared to the population of Bangladesh.
Insurance coverage rates are much higher in the developed world, including neighboring countries.
NN: Why are the people of Bangladesh unwilling to take insurance?
Md. Kazim Uddin: The lack of proper knowledge about the benefits of insurance and various negative campaigns or disinformation about insurance is holding the sector back.
Due to this, the desired expansion of the insurance industry in Bangladesh has not taken place.
Although the country has a huge population, the rate of insurance customers in Bangladesh is very low.
About 5 percent of our total population is covered by insurance.
The contribution of insurance to the Gross Domestic Product (GDP) is only 0.45 percent.
In the developed world this rate is close to 100%.
Insurance contribution to the GDP of our neighboring country India is also 4.2 percent.
This rate is quite satisfactory in other countries including Nepal, Thailand.
Lack of customer confidence and awareness is the major reason behind the backwardness of the insurance sector in our country like other countries.
However, to make people interested in insurance, insurance companies need to improve the quality of customer service and timely payment of insurance claims.
NN: How much do you see the future potential of the newly introduced bancassurance?
Md. Kazim Uddin: Bancassurance has huge potential in Bangladesh.
The introduction of bancassurance is a landmark step.
Through bancassurance, insurance will be more accessible to the people and the financial security benefits of the people will be extended.
Among the current 18 crore people of Bangladesh, 10 crore people are adults.
But among these 10 crore working people, less than 1 crore are covered by insurance.
It is hoped that through Bancassurance, public confidence in insurance will increase and penetration in insurance will increase significantly.
Our neighboring country India has an insurance take-up rate of about 55% through bancassurance and about 45% insurance take-up through agencies and other channels.
India’s SBI Life Insurance alone earned Rs 17,830 crore through bancassurance out of their gross premium earned of Rs 29,590 crore in 2022, which is 60% of their gross premiums.
If we can advance bancassurance through a comprehensive plan, we will also be able to earn huge premium income, which will greatly contribute to the economic development of the country.
NN: State your assessment of insurance claim payouts?
Md. Kazim Uddin: Insurance claim settlement not only benefits the concerned customer but also the entire insurance industry. Timely payment of insurance claims increases the interest and confidence of the general public towards insurance. For this, the companies have to take measures to pay the insurance claims quickly after the expiry. Claims should be settled expeditiously without delay in the name of procedural proceedings. Involving dignitaries including local public representatives in issuing claim checks will remove negative perceptions of insurance and create a positive image; which will help in generating new customers. It is specifically noted here that National Life paid claims of Tk 1093 crore in 2023. As a result in 2023 we have been able to earn a total premium income of Tk 1864 crore.
NN: What is the total number of policies sold, number of customers, number and amount of claims paid, claim settlement rate, life fund, current investment of your organization as per latest data?
Md. Kazim Uddin: At the end of 2023, the number of insurance policies sold by National Life is 64 lakhs 59 thousand 730, total premium earned is 16 thousand 846 crores, life fund is 5 thousand 276 crores, investment is 5 thousand 296 crores and total assets are 6 thousand 041 crores of rupees. Moreover, in 2023, the total claim paid is 9 thousand 877 crores.
95% of our life funds are invested in various sectors including 38% in government treasury bonds. Life fund money has been properly stored for the last 39 years to maintain the company’s financial base and ability to pay customer claims. National Life has never experienced a financial crisis in the past, nor is it likely to do so in the future. Life Fund is growing at a significant rate every year. This is why National Life stands on a strong financial footing today.
NN: How to evaluate Bangladesh Insurance Association for the development of insurance sector?
Md. Kazim Uddin: Bangladesh Insurance Association (BIA) is making an important contribution to the development and expansion of the insurance sector. Since the formation of BIA, the organization has been working as one of the partners of regulatory agencies in the development and problem solving of the insurance industry. BIA is involved in the overall development of the insurance industry including the formation of IDRA, introduction of new insurance laws and National Insurance Day. One of the contributions of BIA is the awarding of National Awards to companies on National Insurance Day by BIA.
NN: What kind of initiatives do you think the regulatory body should take to develop the insurance sector?
Md. Kazim Uddin: Insurance Development and Regulatory Authority (IDRA) has been playing a significant role in the overall development of the insurance sector. Still, I think there is a need for the organization to take some more steps for the development of this sector. In particular, the IDR has to supervise the life insurance companies to ensure that the life fund money is invested in government treasury bonds as per the IDRA guidelines. If life fund money is properly invested, companies should not face any problem in paying insurance claims. As a result, transparency will be ensured here. Moreover, the use of information technology, providing policy support to companies in formulating modern insurance plans, organizing seminars, symposiums on insurance promotion and making life insurance compulsory for all.
