How insurance reshapes financial security for single mothers in Bangladesh

Raj Kiron Das: The number of single mothers in Bangladesh is steadily increasing, bringing greater attention to their financial security and long-term stability. Managing a household on a limited income while ensuring a child’s future places a significant burden on these women. In this context, savings and life insurance are no longer optional; they are emerging as essential factors for financial protection.

Despite this growing need, insurance penetration in Bangladesh remains low. According to the Insurance Development and Regulatory Authority (IDRA), the sector’s penetration rate is still between 0.40% and 0.50%, which is comparatively low within the region.

Emergence of women-centric insurance products

In recent years, several insurers have introduced policies tailored specifically for women, offering new opportunities for single mothers to secure their financial future.

Guardian Life Insurance’s EasyLife Jaya policy is one such example. It combines monthly savings with life and critical illness coverage. With a monthly premium starting at just Tk 350, policyholders can access health protection coverage of up to Tk 5 lakh. This affordability makes it particularly attractive for low- and middle-income women.

Similarly, Green Delta Insurance’s Nibedita policy stands out for its unique coverage. In addition to accidental death benefits, it provides financial support for traumatic incidents such as acid violence, rape and robbery. Annual premiums start at Tk 580, offering coverage ranging from Tk 1 lakh to Tk 10 lakh, making it a crucial safety net for women facing high-risk situations.

MetLife Bangladesh has also introduced long-term solutions such as its Education Protection Plan. In 2024, the company settled claims worth Tk 2,895 crore with a high claim settlement ratio of approximately 97.79%. Under this plan, if the insured mother passes away, her child receives a monthly allowance equivalent to 2% of the insured amount and all future premiums are waived. This ensures continuity in the child’s education despite the loss of the primary caregiver.

Multi-layered protection for vulnerable families

These insurance products provide multiple layers of security. They help maintain children’s education in the absence of a parent, support families during major health crises and encourage disciplined long-term savings.

A study published in the International Journal for Equity in Health highlights the importance of such coverage. It found that around 26% of households in Bangladesh face financial hardship due to the cost of treating serious illnesses. Insurance products that include health coverage can significantly reduce this risk.

Additionally, with women owning approximately 26% of businesses in the country, savings-based insurance plans play a critical role in ensuring financial independence during old age.

Persistent challenges undermine trust

Despite these advancements, challenges remain. In 2024, the average claim settlement rate in the life insurance sector stood at around 66.03%, slightly lower than the previous year. This decline may affect public trust in insurance providers.

Inflation also poses a significant concern. Over time, it can erode the real value of long-term savings, reducing the effectiveness of insurance as a financial planning tool.

Access is another major barrier. Insurance services are still limited in many rural areas, preventing broader financial inclusion and leaving vulnerable populations underserved.

Policy support and future prospects

Experts believe that increasing awareness and ensuring transparency in claim settlements are key to strengthening trust in the insurance sector. While women-focused policies show strong potential, their success depends on accessibility and customer confidence.

At the policy level, new initiatives are underway. A joint study by the Centre for Policy Dialogue (CPD) and ARK Foundation suggests plans to introduce a maternity protection insurance scheme by 2026. The proposed plan would offer coverage of up to Tk 41,000 with annual premiums ranging from Tk 60 to Tk 1,015. If implemented, this could provide a basic safety net for low-income women.

Insurance is gradually emerging as a key financial tool for single mothers in Bangladesh, offering protection against income shocks, health risks, and future uncertainties. However, its full potential will depend on improving accessibility, enhancing trust, and expanding awareness.

While progress is evident, sustained efforts are needed to ensure that insurance evolves into a reliable and inclusive financial solution for vulnerable families.