IDRA must be reformed without delay

A.K.M Ehsanul Haque, FCII: The Insurance Development and Regulatory Authority (IDRA), entrusted with the sacred responsibility of regulating Bangladesh’s insurance sector, have failed to fulfill its fundamental duties. When every other key institution in the country is being made answerable, there is no justifiable reason why IDRA should remain beyond scrutiny.

The government made IDRA with the objective of ensuring discipline, transparency and fairness in the insurance industry. Its mandate is to curb corruption, eliminate irregularities and restore public confidence in an industry plagued by mismanagement and malpractice. Yet, despite this vital mission, IDRA has proven itself to be mainly ineffective. The insurance sector remains in alarm- lacking coordination, credibility and consumers’ trust.

Allegations of corruption and misconduct in the regulatory body itself have only deepened public frustration. There are growing calls for the authorities concerned to initiate an immediate and impartial investigation into these allegations. Those found guilty of wrongdoing must be held answerable under the law, as no public servant is above responsibility.

The insurance companies, operating under IDRA’s supervision, continue to violate insurance laws with apparent impunity. Repeated violations- ranging from non-payment of claim to manipulation of premium- are met with silence or inaction from the regulator. This has sent an alarming signal to the public, suggesting that IDRA either lacks the will or the competence to enforce the very rules it was established to uphold.

A fragile and passive regulator benefits no one. It erodes confidence in the system, discourages honest operators and drives policyholders away from appropriate insurance selection. The result is an uneven and mistrusted financial sub-sector that fails to serve the public interest or support the national economy.

Public patience is wearing thin. Policyholders are no longer willing to tolerate negligence, inefficiency and corruption in the regulatory framework. If IDRA cannot safeguard the interest of the insured, then its very existence comes into question.

It is time for a complete renovation of the institution. The management must consider appointing qualified insurance professionals with deep sectoral expertise to vital leadership positions in IDRA. The long-running experiment of entrusting officials without industry experience to run the authorities concerned has failed miserably.

For Bangladesh’s insurance industry to progress, decisive reform is imperative. Answerability must begin at the top. IDRA must either rise to the challenge of reform or make way for leadership capable of restoring order, transparency and public trust in one of the nation’s most critical financial sectors.