The New Nation - Internet Edition

MANY people do not have a very good impression about insurance companies and their agents. This facet of the reality has been reflected in the observation of a highly placed official of the government. The commerce secretary brought a number of serious allegations against insurance companies while he was speaking at an award giving ceremony of the Bangladesh Insurance Executive Club (BIEC) in the city the other day. He came down heavily on some companies for violating the insurance rules and code of conduct and playing foul with the clients. Insurance is a matter of trust. People open insurance policies with the expectation of a secured future. But when the companies make breach of trust people lose confidence in them.

The most serious allegation against them is that they follow a complicated and lengthy process in settling claims of policy holders. Insurance agents sometimes collect premiums from the clients but do not deposit money to the company accounts.

Due to such flagrant violation of business ethics and breach of trust people turn their faces away from the insurance companies and find out alternatives where possible. In the life insurance sector, people are usually found to prefer a foreign company instead of the local ones. The insurance companies must think over the image crisis that they themselves have created and must regain the lost confidence.

However, the commerce secretary was not without a praise for the insurance companies for the role they are playing in economic development, industrialization, agricultural development, rural poverty reduction and employment generation. Last year the insurance companies invested Tk 5,800 crore in different sectors including real estate and the stock market. They are also contributing to the rural economy by bringing rural poor under micro-insurance coverage. They can do more if they adhere to business norms and ethics.