DU to jointly study challenges, prospects of insurance sector

The Department of Banking and Insurance at the University of Dhaka and Insurance News BD will jointly conduct a comprehensive study on the overall state of Bangladesh's insurance sector and the way forward amid longstanding challenges including slow claims settlement, a lack of customer confidence, weak governance and regulatory limitations.

To this end, the two organisations signed a Memorandum of Understanding (MoU) today (28 September) at the Department of Banking and Insurance at the university.

Titled "Insurance Sector of Bangladesh: Reality, Challenges and Way Forward," the study will examine the current state of the country's insurance industry, its structural weaknesses, growth prospects, regulatory framework and customer service landscape.

Professor Dr Md Shahidul Islam Zahid, chairman of the Department of Banking and Insurance at the University of Dhaka, and Mostafizur Rahman Tunku, editor and publisher of Insurance News BD, signed the MoU on behalf of their respective organisations.

Dr Mahfuz Kabir, research director at the Bangladesh Institute of International and Strategic Studies (BIISS), and Dr Biswajit Kumar Mondal, consultant to Insurance News BD, were also present at the signing ceremony.

What the study will examine

The study will assess the structure, growth, financial performance and contribution of Bangladesh's life and non-life insurance sectors to the economy.

It will also analyse insurance penetration and density, development of new insurance products, distribution channels, claims settlement and the quality of customer services.

A key focus of the research will be governance and the regulatory framework of the sector. It will examine the roles of regulators, insurance companies and other stakeholders, as well as institutional capacity, technology adoption and shortages of skilled human resources.

The study will also review public trust and awareness of insurance, the sector's role in financial inclusion and barriers to expanding insurance services among the general population.

Both primary and secondary data will be used for the research. Information will also be collected through consultations and discussions with insurance companies, regulatory authorities, policyholders, customers, experts and other stakeholders.

Academic independence

Under the agreement, the Department of Banking and Insurance will be responsible for the research design, methodology, data analysis and academic quality assurance.

Insurance News BD will act as the sponsoring and collaborating partner, providing financial support, relevant sectoral data and documents, investigative materials and industry knowledge. It will also facilitate engagement and consultations with relevant stakeholders where possible.

The University of Dhaka, however, will retain academic independence in the analysis, findings and recommendations of the study. While Insurance News BD may provide input on factual accuracy and practical relevance, it will not interfere with the research findings.

The research will begin immediately after the signing of the MoU and is expected to be completed by February 2027. A comprehensive research report will be published upon completion.

'Will help inform policymakers'

Speaking at the event, Professor Dr Md Shahidul Islam Zahid said the insurance sector is important for Bangladesh's financial stability and inclusive growth.

"Through this partnership, we aim to apply rigorous research standards to an important sector. By combining the academic expertise of the University of Dhaka with the sectoral experience of Insurance News BD, we seek to produce an objective assessment that can contribute to policymaking," he said.

Mostafizur Rahman Tunku said Insurance News BD has long been working to promote informed discussion on the country's insurance sector through news, investigations and analysis.

"Our expectation from this collaboration with the University of Dhaka is to identify the structural challenges of the insurance sector more clearly and find practical ways to ensure its sustainable development," he said.

Why the study matters

The role of Bangladesh's insurance sector in the broader financial system remains relatively limited compared with banking and the capital market. Yet insurance plays an important role in risk management, long-term savings, investment and financial inclusion.

Improving the sector therefore requires more than strengthening the financial position of individual insurers. Customer confidence, faster claims settlement, effective regulation, stronger governance, greater use of technology and the development of new insurance products are also important.

The joint study by the University of Dhaka and Insurance News BD is expected to provide an evidence-based assessment of these issues and the broader realities of the insurance sector. It could also provide a useful foundation for regulators, insurers and policymakers in identifying priorities and determining the way forward.