Problem and prospect of insurance in bangladesh

Traditional Insurance Act The present insurance act was enacted more than half a century back. Micro insurance can be a great prospective area for the insurance business in our country.

For that reason government changed the company management, policy and applies new rules and regulations which system was very tricky and uncomfortable for the mass people.

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At one side, insurance business is not well known to the general people and on the other side; the known people are dubious about its service. Recently government is trying to take initiative to close some of the insurance companies because they are not maintaining the minimum standards.

Centralization Most of the insurance companies in our country are located in urban areas and there are few branches in rural areas. In our internal saving was only The lack of financial solvency further reduces subscriptions to Islamic insurance.

The general insurance market in Bangladesh now consists of 43 private sector insurance companies and 1 state owned insurance company. Problem of planning and administration After the change of the government, the whole planning and administrative measures are changed which is the main constraint for long term plans.

Up tothe government has given permission to 19 general insurance companies and 10 life insurance companies in the private sector. The uncertainty of agriculture due to crop failure caused by climate variation, drought, cyclone, flood and pests affects farmer income as well as government revenue.

The insurance companies show different causes in order to make delay to return back the money at expected time. This gives the PSC, compared to private companies, many advantages. Permissions to private insurance companies to act as reinsures will open up new opportunities to them.

Centralization Most of the insurance companies in our country are located in urban areas and there are few branches in rural areas. The broadness of insurance business is helpful to survey. Therefore they are quite unable to give the amount to the insurer which is called as premium and regarded as safety or precautionary measures against any accident.

Agents are not skilled enough. Those who are harassed by the insurance companies discourage other not to take an insurance policy Lack of motivation program towards public According to Green Delta Life Insurance Company the people of our country are not much motivated by the company to take insurance policy for safeguarding them selves against any kind of risk.

Thus insurance business has a bright prospect in business sector in adeveloping country like Bangladesh Education sector: The scope of education about insurance is so much little in our country.

Organizational policies and standards for service levels may be in place, but is front line staff following them. Therefore the people are discouraged to take insurance policy because they think that the complexities will create extra pressure on their mind which may hamper other jobs.

Whereas foreign companies are using modern systems like computerized system; our local company does not want to change themselves. Inability to save or negligible savings by a vast majority of population kept them away from the horizon of life insurance.

1. 1. Introduction Background of the Report This report has been prepared as a requirement of the insurance and risk management course. The report was based upon the overall insurance company’s problems and prospects in Bangladesh/5(7).

The report was based upon the overall insurance company’s problems and prospects in Bangladesh. I was duly approved by our Course Teacher cwiextraction.coml Hoque.

This report will help us know about the insurance business problems and prospects in Bangladesh. Insurance is a system of spreading the risk of one to the shoulders of many/5(7). Problem of Insurance Business in Bangladesh In a developing country like Bangladesh, insurance companies are playing a very important role in the economy.

Though insurance industry has very prospect in the economy but for some reasons it’s totally failed to achieve its goal. The insurance company undertakes to indemnify the insured against any loss in lieu of a small charge known as premium.

Such as insurance policies except life insurance allows a policy-holder to transfer all risk to the insurance company in exchange of paying a certain amount of premium. The. The insurance company undertakes to indemnify the insured against any loss in lieu of a small charge known as premium.

Such as insurance policies except life insurance allows a policy-holder to transfer all risk to the insurance company in exchange of paying a certain amount of premium. The. Prospect of Islamic insurance (Takaful) in Bangladesh Although the first Islamic insurance company was established in Sudan (Bekkin ), it has expanded globally, especially in Asia (Rahman ).

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Problems and prospects of Insurance in Bangladesh