Private entrepreneurs in Bangladesh's insurance sector are planning to introduce micro-insurance to insure the low-income people financially.
A micro-insurance conference, in this regard, will be held at a city hotel on November 5-8 to help the entrepreneurs acquire a clear idea about it.
This is for the first time an international conference on insurance is going to be held in the country.
Prime Minister Sheikh Hasina will inaugurate the convention, to be jointly organised by the Munich Re Foundation and the Bangladesh Insurance Association, associated by Luxemburg-based Micro-Insurance Network.
Around 460 representatives and insurance experts from around 40 to 50 countries will participate in the event, informed a press briefing at the Bangladesh Insurance Association.
The conference will discuss the roles of micro-insurance in financial protection of the low-income group in attaining the Sustainable Development Goals set forth by the United Nations.
"We will learn clearly about micro-insurance from the conference. We will learn from the countries which have already introduced this type of insurance," said Sheikh Kabir Hossain, president of the country's apex body in the field of Insurance.
However, the Microcredit Regulatory Authority Act 2006 incorporates a provision, allowing micro-insurance privileges for borrowers against the loans. Microfinance non-government organisations are giving the facility in the country.
But entrepreneurs in the insurance sector said these organisations are not supposed to give the facility this way.
None other than the insurance companies, according to the relevant law, can give this privilege to the people. But there is no law in the country to run micro-insurance programme by the insurance companies, they said.
The country also lacks necessaryinfrastructure for the programme, according to them.
Earlier, the General Insurance Corporation of the country launched Weather Based Crop Insurance, with cooperation from the Asian Development Bank. It was a pilot project and did not succeed that much.
"We have no study on micro-insurance. Hence, we cannot say how we can bring the poor under insurance right now," said Md Imam Shahin, chief executive officer of the Asia Insurance Limited – a non-life insurance company.
But he expressed hope that they would get a clear idea about it in the November conference.
Earlier, Finance Minister AHM Mustafa Kamal, while announcing budget for fiscal year 2019-20, said about bringing poor and marginal people under insurance coverage.
However, the press conference also informed that the Insurance Authority is now preparing regulations for non-life insurance companies to invest at least 15 percent of their funds to public bonds.
If the regulations are implemented, non-life companies will have to invest about Tk4,000 crore to public bonds.
But such a size of investment in public bonds might pose negative impacts on the capital market and the banking sector, said Nasir Uddin Ahmed, vice-chairman of the Karnaphuli Insurance.
"This is because we will have to draw this huge bulk of money from these institutions to buy bonds. So, we recommend five percent investment from the funds of non-life companies," he said.