Regulator appoints observers at two life insurers

The insurance regulator has appointed observers at two life insurers to protect the interests of policyholders and ensure good governance in the companies.

Progressive Life Insurance and Sunlife Insurance lost 3.93% and 2.96%, respectively, in the value of their shares at the Dhaka Stock Exchange (DSE) following disclosures the companies made on Sunday.

However, the insurers earlier witnessed more than 71% and 10% jumps respectively in their share prices over a few days.

According to stock exchange filings by the companies, the Insurance Development and Regulatory Authority (Idra) has appointed its Director Abdul Mozid as an observer to Progressive Life's board and Director Shah Alam to the Sunlife Insurance Company's board.

Idra said in its letter that policyholders are constantly filing complaints with Idra due to the non-payment of insurance claims on time by the two companies.

The regulator also added that non-payment of insurance claims on time is causing extreme dissatisfaction among customers and tarnishing the image of the insurance industry.

Progressive Life Insurance's Chief Executive Officer Ajit Chandra Aich and Sunlife Insurance's Chief Executive Officer Mohammad Nurul Islam could not be reached over mobile phones for their comments to this end.

They did not even respond to a text message sent on their cell phones.

In its 2019 annual report, Progressive Life Insurance's auditor said the company fell into trouble due to non-transparency in the firm's premium income, buying disputed properties, negative cash flow, and huge unpaid claims.

Incorporated in 2000, Progressive Life Insurance Company Limited was listed on the capital market in 2006.

From 2019, it could not conduct annual general meetings, and that is why it has failed to pay any dividend since then.

According to its 2019 financial statement, its life fund was Tk276.96 crore and its unsettled claim amount was Tk30 crore.

Progressive Life shares with a face value of Tk10 each closed at Tk102.8 on the DSE on Sunday.

According to Idra officials, Sunlife Insurance has admitted that mature life insurance policies worth around Tk100 crore are still unpaid.

In March 2021, a Kushtia court issued arrest warrants against five people, including the company's chairperson, Professor Rubina Hamid, in connection with nine lawsuits filed by clients who had not received the claims.

Rubina is the sister of Health Minister Zahid Maleque.

The regulator, earlier in February 2021, appointed two of its officials as observers on the life insurer's board. But it retreated from its decision within two days, allegedly due to unknown pressure.

According to the company's January–September 2022 report, its consolidated life revenue accounts decreased to Tk90.47 crore from Tk126 crore.

The last trading price of the company's shares at the DSE was Tk59.10 each.