IDRA moves to abolish commission for non-life insurance agents

Staff Correspondent: The Insurance Development and Regulatory Authority (IDRA) has taken a step by deciding to abolish agent commission in Bangladesh’s non-life insurance sector, a move set to take effect on 1 January 2025.

The decision was reached during a meeting at the IDRA headquarters on Tuesday (Nov 25) with leaders of the Bangladesh Insurance Association (BIA), including BIA President Sayeed Ahmed, non-life insurance CEOs and senior IDRA officials, chaired by IDRA Chairman Dr M Aslam Alam.

IDRA said a gazette will be issued soon outlining execution procedures. The regulator views the reform as crucial to improving transparency, reducing business irregularities and restoring discipline in the non-life insurance market, where commission-driven sales practices have long influenced pricing and competition.

Industry CEOs vowed to work without agent commission under the new framework, marking a major shift for a sector comprising 46 non-life insurers, including one state-owned company. The move is expected to reshape the distribution model, strengthen ethical business practices and promote fairer pricing for policyholders.