The Insurance Industry in Bangladesh: Challenges, Opportunities, and the Path Forward

Why Insurance Matters – For You and the Economy

Insurance is a safety net—for individuals, businesses, and the economy. It protects against financial losses due to accidents, illnesses, natural disasters, or even death. For individuals, insurance means security for their families and assets. For the economy, it promotes stability by spreading risks and encouraging investments.

Despite its importance, Bangladesh’s insurance penetration remains low compared to its potential. Many people still view insurance with skepticism, missing out on its benefits. In this blog, we’ll explore:

• Types of insurance (Life & General)

• Insurance penetration & market trends

• Why people distrust insurance

• Steps to improve trust & adoption

• Key players & market share

• Comparison with neighboring countries

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Two Major Types of Insurance in Bangladesh

1. Life Insurance

Life insurance provides financial security to a policyholder’s family in case of death or critical illness. It also serves as a long-term savings tool.

Key Features:

• Term Life Insurance – Pure risk coverage for a specific period.

• Endowment Plans – Combines savings with insurance.

• Pension Plans – Ensures retirement income.

Top Life Insurers in Bangladesh (2024):

• Jiban Bima Corporation (State-owned)

• MetLife Bangladesh

• Pragati Life Insurance

• Delta Life Insurance

2. General Insurance (Non-Life Insurance)

Covers risks related to property, health, vehicles, and businesses.

Key Categories:

• Health Insurance – Covers medical expenses.

• Motor Insurance – Mandatory for vehicles.

• Fire & Property Insurance – Protects against disasters.

• Marine & Travel Insurance – Covers cargo & trip risks.

Top General Insurers in Bangladesh (2024):

• Sadharan Bima Corporation (State-owned)

• Green Delta Insurance

• Pioneer Insurance

• Phoenix Insurance

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Insurance Penetration in Bangladesh – Where Do We Stand?

Despite a growing economy, insurance penetration in Bangladesh is only around 0.6% of GDP (IDRA, 2023), one of the lowest in South Asia.

Comparison with Neighboring Countries (2023 Data)

Source: Swiss Re Sigma Reports, IDRA

Bangladesh lags due to low awareness, trust issues, and a lack of financial literacy.

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Why Don’t People Trust Insurance in Bangladesh?

1. Misleading Sales Practices – Agents sometimes mis-sell policies for commissions.

2. Claim Settlement Delays – Many face difficulties in getting claims paid.

3. Lack of Awareness – Rural populations remain unaware of insurance benefits.

4. Religious Misconceptions – Some believe insurance conflicts with Islamic principles (though Takaful insurance is Sharia-compliant).

5. Weak Regulatory Enforcement – Fraudulent insurers have eroded trust in the past.

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How Can We Improve Trust & Adoption?

1. Strengthening Regulations & Transparency

• IDRA (Insurance Development and Regulatory Authority) must enforce stricter compliance.

• Faster claim settlements through digitization.

2. Financial Literacy & Awareness Campaigns

• Government & insurers should collaborate on mass education programs.

• Simpler policies with easy-to-understand terms.

3. Digital Transformation

• Mobile-based insurance (BimaBondhu, Grameenphone Bima).

• Blockchain for fraud prevention.

4. Customized Products

• Microinsurance for low-income groups.

• Agriculture insurance for farmers.

5. Encouraging Islamic Insurance (Takaful)

• Sharia-compliant products can attract more customers.

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Market Share & Key Players (2024)

Life Insurance Market Share (Top 5)

1. Jiban Bima Corporation (~30%)

2. MetLife Bangladesh (~20%)

3. Pragati Life Insurance (~15%)

4. Delta Life Insurance (~12%)

5. Sunlife Insurance (~8%)

General Insurance Market Share (Top 5)

1. Sadharan Bima Corporation (~25%)

2. Green Delta Insurance (~18%)

3. Pioneer Insurance (~12%)

4. Phoenix Insurance (~10%)

5. Reliance Insurance (~8%)

Source: IDRA Annual Report 2023 (Link).

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Final Thoughts: The Future of Insurance in Bangladesh

The insurance industry has huge growth potential, especially with Bangladesh’s rising middle class and digital adoption. However, trust-building, transparency, and innovation are key to unlocking this potential.

If regulators, insurers, and consumers work together, Bangladesh can achieve higher insurance penetration, safeguarding millions and boosting economic resilience.

 

C.Basu

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Bibliography with Links

1. Insurance Penetration & Market Data (Bangladesh & Neighboring Countries)

• IDRA (Insurance Development and Regulatory Authority, Bangladesh)

  • Annual Report 2022-2023

  • Market Share Data

• Swiss Re Sigma Reports (Global Insurance Trends)

  • World Insurance Report 2023

• Bangladesh Bank (Financial Sector Reports)

  • Financial Stability Report 2023

2. Insurance Penetration Comparison (South Asia)

• Statista (Insurance Market Data)

  • Insurance Penetration in South Asia

• IRDAI (India’s Insurance Regulatory Authority)

  • India’s Insurance Report 2023

• State Bank of Pakistan (Insurance Sector Data)

  • Pakistan Insurance Industry Report

3. Insurance Companies & Market Share

• MetLife Bangladesh Annual Report

  • MetLife Financial Statements

• Green Delta Insurance Reports

  • GDIC Market Share & Performance

• Pragati Life Insurance

  • Annual Report 2023

4. Challenges & Trust Issues in Bangladesh’s Insurance Sector

• The Daily Star (Bangladesh News)

  • Why People Don’t Trust Insurance

• Dhaka Tribune (Insurance Fraud Cases)

  • Regulatory Challenges in Insurance

5. Digital Insurance & Future Trends

• Bangladesh’s Mobile Insurance (BimaBondhu)

  • BimaBondhu Initiative

• Grameenphone Bima (Mobile Insurance)

  • GP Insurance Services