DHAKA, Insurance Bulletin: The Insurance Development and Regulatory Authority (IDRA) has launched a comprehensive inspection into nine insurance companies across the country following allegations of continued commission payments despite a regulatory freeze on individual agency operations.
The regulator disclosed the information in a press release issued today, Tuesday (June 16).
According to IDRA, individual agency activities for non-life insurance companies were officially suspended starting January 1 this year. This decision was made following an application by the Bangladesh Insurance Association (BIA) and with the unanimous consent of the non-life insurance insurers.
However, allegations surfaced that several companies have circumvented the directive to secure businesses. These firms reportedly continued to disburse commissions disguised under various accounts, including salaries, allowances, and 'no-claim bonuses.'
Industry insiders warned that such malpractices are fostering unhealthy competition, undermining regulatory compliance, and disrupting the level playing field necessary for good corporate governance in the insurance sector.
To verify the allegations and ensure compliance with existing laws, IDRA has formed three separate inspection committees. Following an official order issued on June 4, distinct teams were deployed to investigate the accounts and operations of the accused firms.
The nine insurance companies currently under regulatory scrutiny are:
Provati Insurance PLC, Paramount Insurance PLC, Bangladesh National Insurance Company Limited, Crystal Insurance PLC, Asia Pacific General Insurance PLC, Union Insurance Company Limited, Global Insurance PLC, Karnafuli Insurance Company Limited and Prime Islami Life Insurance PLC.
The inspection teams are mandated to submit their findings directly to IDRA's Vigilance Team. The regulator emphasized that strict legal action will be taken against any institution found guilty of financial irregularities or violating the suspension order.
Mohammad Abu Bakar Siddique, IDRA Member (Non-Life Insurance), said- The validity of the allegations will be thoroughly verified based on the inspection reports. If any irregularities are proven, necessary legal action will be taken against the respective companies in accordance with existing laws and regulations.
