BIA calls meeting of non-life insurance CEOs to secure seven key commitments

Staff Correspondent: The Bangladesh Insurance Association (BIA) has called a meeting of chief executives from non-life insurance companies to seek their commitment to a set of ethical and regulatory principles aimed at restoring discipline and integrity in the industry.

The meeting, scheduled for Tuesday (October 14) will take place at a hotel in Dhaka and will be chaired by BIA President Sayeed Ahmed.

According to the notice issued by the association, the meeting will review the progress made on the decisions adopted in the previous session. However, insiders from the non-life insurance sector exposed that the gathering’s core objective is to attain formal commitments from the CEOs on several crucial issues that have long affected the credibility and competitiveness of the industry. The BIA has already circulated a formal declaration form and a signature sheet to the participants, outlining the commitments they are expected to make. The document also specifies that the content of this declaration will remain confidential.

The proposed commitments focus on curbing unethical business practices that have become prevalent in the non-life sector. These include eliminating irregular and unhealthy competition, discouraging unauthorised commission and unethical inducement and ensuring strict adherence to the Insurance Act of 2010 along with all relevant regulation. The initiative also calls on company heads to stop the unethical transfer of clients or current business from other insurers, to oversee their subordinates, branch managers and agents to ensure compliance with ethical standards and to faithfully execute the regulator’s directive on the zero-percent agent commission rate. The declaration further binds signatories to accept legal consequence if any of these commitments is violated.

Despite the initiative’s intent to promote integrity and fair competition, several industry stakeholders have questioned the association’s power to impose binding commitment or apply disciplinary action in the event of a breach. They also cautioned that such a move might invite controversy over the scope of BIA’s power and could ultimately raise doubt regarding the association’s neutrality and governance standard.