Kathmandu: The Ministry of Finance of Bangladesh has decided to tighten the procedure and directives for the life insurance fund management, The Department of Financial Institutions(DFI) under the Ministry of Finance has taken such steps following the information of embezzlement of such funds by a handful number of promoters of life insurance companies.
According to the local media The Financial Express, the DFI has already conducted a joint meeting comprising of Bangladesh Insurers Association, Bangladesh Insurers Forum and Insurance Development and Regulatory Authority(IDRA) for their feedback.
Citing a source, The Financial Express said that the government has been active in strengthening the effective operation, transparency and trust of insurance companies to ensure the interest of policyholders. The Ministry of Finance has been forced to become active as the regulatory body has not been able to monitor the life insurance fund of the life insurance companies effectively.
Although the policyholders have 90 percent investment in the life insurance fund and the promotors’ have only 10 percent investment on it, it is widely misused by the handful numbers of promoters.
IDRA is the regulatory body for insurance companies in Bangladesh. However, the chairman of the IDRA is also involved in the case of financial irregularities and facing graft charges.
The life fund is of tk 500 billion which amounts more than 707 billion Nepalese rupees. Out of the total fund, funds above 60 percent has been invested in the government securities and fixed deposits.