Insurance regulator unveils guidelines for bank-insurance partnerships

The Insurance Development and Regulatory Authority (IDRA) on Tuesday issued a circular outlining the appointment of corporate agents by commercial banks for partnering with insurance companies.

This follows a previous circular on the matter by the Bangladesh Bank.

The new guideline titled 'Corporate Agent (bancassurance) Guideline - 2023' allows banks to directly sell insurance products to their customers.

Under its provisions, each bank can offer a maximum of three life and three non-life insurance products under its umbrella.

Obtaining a corporate agent licence for bancassurance activities will require banks to pay a Tk 50,000 fee to the IDRA, valid for three years.

While banks can sell all types of life insurance products, they are restricted to specific non-life categories: motor, travel, health and crop insurance.

This bancassurance model will be a direct sale method, which will see banks utilising their existing workforce to market insurance products.

To apply for a corporate agent licence, banks must submit the following documents to the IDRA: a draft agreement with the partnering insurance company, approval from the Bangladesh Bank and a payment order for the licence fee.

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