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The insurance sector is currently facing a deep trust deficit, as claim settlements are being delayed by several companies. In some cases, funds were allegedly embezzled, worsening the crisis.

According to an audit report, Fareast Islami Life Insurance allowed its former chairman and directors to commit repeated financial crimes and siphon off more than Tk 2,100 crore of policyholders’ money between 2010 and 2020.

Similar incidents have been reported in other insurers, leaving the sector broadly affected by financial mismanagement and embezzlement.

Bangladesh’s insurance penetration remains below 0.5 percent, reflecting the sector’s limited reach and weak public trust.

Nadia also identified three key priorities for sustainable reform -- restoring public confidence, strengthening the regulatory framework and long-term investment, and improving human resource capacity.

Speaking as the chief guest, Rashed Al Mahmud Titumir, adviser to the Ministry of Finance and Planning, said there is no alternative to rapid digital transformation, good governance, and a strong regulatory framework if the insurance sector is to become efficient, sustainable, and trusted.

He said the industry must become modern, transparent, accountable, and technology-driven to overcome its current challenges.

He added that the sector has yet to achieve meaningful digitalisation, creating gaps in customer service, claims settlement, information management, and governance.

“Effective use of technology will not only improve customer satisfaction but also significantly enhance transparency, accountability, and operational efficiency,” he said.

Titumir also said Bangladesh is highly vulnerable to climate change, making a strong insurance sector essential for managing disaster-related losses and ensuring economic security.

He said traditional supervision alone is not enough. Sector-specific audit systems should be introduced, along with stronger capacity and independence for regulators.

“Public confidence in the insurance sector can only be restored through long-term reforms, good governance, transparency, and accountability,” he added.

The seminar was chaired by IRF President Golam Mowla. Speakers included Sayeed Ahmed, president of the Bangladesh Insurance Association, BM Yusuf Ali, president of the Bangladesh Insurance Forum, and Prof Md Shahidul Islam Zahid of the Department of Banking and Insurance at the University of Dhaka.