TBT DESK: Bangladesh’s insurance regulator has given companies six weeks to remove hidden or duplicate servers and consolidate their data, warning that insurers that fail to comply could face legal action.

Insurance Development and Regulatory Authority (IDRA) Chairman Mir Nadia Nivin said insurance companies were not always providing regulators with an accurate picture of their businesses, with some allegedly maintaining multiple or “double servers” to conceal information.

“Even if a server is hidden in someone’s garage, under a bed or somewhere else, we will find it,” she said, describing the six-week deadline as a warning to the industry.

Nivin was speaking as the chief guest at the opening of a two-day residential workshop organised by the Insurance Reporters Forum (IRF) at the Bangladesh Academy for Rural Development (BARD) in Cumilla on Friday.

The workshop, titled “How to Write News Easily from Companies’ Annual Reports”, focused on financial reporting and data analysis. IRF President Golam Mawla chaired the event.

National Life Insurance PLC Chief Executive Officer Kazim Uddin and the company’s Chief Financial Officer Prabir Chandra Das attended as special guests.

Data gaps hamper effective supervision

Nivin said transparency remained a major concern in both the life and non-life insurance sectors.

“The information companies provide to IDRA is not always the actual information,” she said, adding that the use of multiple servers meant the regulator often lacked a complete picture of companies’ businesses, premium income and financial health.

An annual financial report alone, she said, was not enough to determine the real condition of an insurer.

“Companies must provide accurate and complete information. At the same time, IDRA’s legal and technological capacity must be strengthened to ensure that information is supplied properly.”

She also urged journalists to go beyond simply reproducing figures from annual reports and question whether those figures reflected reality.

“Publishing the information in a financial report is not the end of a journalist’s responsibility,” she said. “You also have to ask whether the information is consistent with what is happening on the ground.”

Nivin said information received by regulators was often too old to be useful for effective supervision.

“If we are sitting in 2026 and receiving an audited report for 2025, it is difficult to supervise the current situation effectively,” she said. “And if the information itself is inaccurate, identifying current risks from data that is already a year or more old becomes almost impossible.”

Risk-based supervision by December

IDRA plans to introduce a fully risk-based supervision system across the insurance industry by December, Nivin said.

The system will help the regulator identify more quickly what information companies are submitting, where gaps exist and which insurers are facing emerging risks.

She described the initiative as a major change in the way the sector is supervised and said IDRA would become a fundamentally different kind of regulator.

Joint checks with BB, NBR and BSEC

IDRA is also seeking closer coordination with Bangladesh Bank, the National Board of Revenue and the Bangladesh Securities and Exchange Commission to prevent companies from concealing information.

Nivin said she had already discussed cooperation, including the identification of bank accounts, with the governor of Bangladesh Bank and had received assurances of support.

She also plans to meet the NBR chairman, while IDRA is working with BSEC on joint special audits.

The current system, under which regulators write separately to different agencies and wait for replies, needs to change, she said.

Institutionalising information sharing among regulators would ensure that cooperation continued even when individual chairmen or officials changed, Nivin added.

One policy ID for the entire industry

IDRA also plans to introduce a unique policy identification number across the insurance sector within the next three to four months.

At present, insurers use their own policy numbers, with no single identifier covering the entire industry. Under the proposed system, every policy will have a centrally identifiable number, similar to a bank account number.

Nivin said IDRA teams were already visiting insurers to work on risk-based supervision, training and the introduction of the unique policy ID.

The system is expected to reduce the scope for showing fictitious premium income, partially disclosing business information or concealing the scale of insurance operations.

Digital verification before LC opening

For the non-life sector, IDRA is also planning a digital system to verify insurance coverage against letters of credit.

In future, banks will not be able to open an LC without a unique cover-note ID issued by IDRA, Nivin said.

The cover note will be checked through the Bangladesh Bank system before an LC is opened. This would allow IDRA to verify whether insurance exists against each LC and determine the value of the related insurance business.

The move is intended to make it harder for companies to conceal the actual volume of business.

Claims payments to begin next week

IDRA will begin paying outstanding insurance claims next week using proceeds from the sale or encashment of assets held by several troubled insurers, Nivin said.

The regulator is initially working with seven to eight companies. Land, treasury bonds, fixed deposits and other assets are being liquidated, with the proceeds kept in separate bank accounts under IDRA’s supervision.

Claims will be paid on a “first application, first payment” basis, she said.

Citing Far East Islami Life Insurance as an example, Nivin said the company faced unpaid claims of around Tk 3,000 crore.

Money raised from the sale of land in Feni and the encashment of some bonds would be used to settle claims. Payments could initially begin with several hundred crore taka, she said.

If all of the company’s assets and bonds could be liquidated, around Tk 1,500 crore might be recovered. After a substantial portion of claims had been settled, IDRA would decide on the company’s future business operations, she added.

Zero tolerance for bribery

Nivin also pledged a tougher stance on bribery within the regulator.

If an insurance company attempted to bribe an IDRA official, the authority would pursue legal action rather than simply issue a warning. Officials who demanded bribes from insurers would face similar action.

She urged journalists to report any evidence of bribery directly to her.

150 staff overseeing 82 insurers

Nivin highlighted the regulator’s severe manpower shortage, saying IDRA was attempting to supervise 82 insurance companies with only around 150 employees.

By comparison, Bangladesh Bank has roughly 7,000 employees to oversee the banking sector, she said.

She also pointed to weaknesses in the existing legal framework, saying the Insurance Act 2010 was no longer fully aligned with the realities of the modern financial sector.

The law needs to be updated and strengthened, she said.

Nivin said IDRA wanted to work with insurers as partners, but companies must comply with regulatory instructions.

“Companies that do not follow the regulator’s instructions will find it difficult to continue doing business,” she said.

She said the regulator’s fundamental responsibility was to protect policyholders’ interests and rights.

For the insurance sector to become a stronger part of the financial system, she said, the first priorities must be greater transparency and restoring public confidence.

‘Timely claims settlement is key to rebuilding trust’

National Life Insurance CEO Kazim Uddin said delays in settling claims were one of the main reasons for the insurance sector’s loss of public confidence.

The financial difficulties and failure to pay claims by a number of insurers had damaged the reputation of the industry as a whole, he said.

“The most effective way to restore public confidence in insurance is to settle claims on time,” Uddin said. “If we can ensure that customers receive what they are entitled to within the stipulated time, the industry can go a long way.”

National Life paid Tk 1,137 crore in insurance claims in 2025, he said. Of this, around Tk 1,110 crore was paid as maturity benefits, survival benefits and other scheduled benefits.

Uddin also described the insurance industry and the media as partners rather than adversaries.

Objective, evidence-based and responsible reporting, he said, could make companies more alert to their shortcomings and strengthen accountability.

“The insurance sector has challenges, but it also has enormous potential,” he said. “If we can ensure timely claims settlement and conduct business transparently, Bangladesh’s insurance industry can emerge much stronger.”