JS body finalises two insurance bills
Friday, 11 September 2009
FE Report
The parliamentary standing committee on finance has finalised two insurance bills -- The Insurance Act 2009 and The Insurance Regulatory Authority Act 2009 -- and it is expected to be passed in the current session, Mr Kamal said at a press briefing Thursday.
The proposed Insurance Act 2009 said the sector needs to be managed properly and be strengthened by reducing business risks, and local and international insurance laws need to be harmonised considering the socio-economic aspect of the country.
The Insurance Regulatory Authority Act 2009 said there is an increasing need to regulate one of the largest sectors in the country, harmonise local and international insurance laws considering the socio-economic aspect of the country, and protect the interest of policy-holders and other related beneficiaries.
Once the proposed insurance act is passed by parliament a life insurance company can pursue both traditional and Islamic insurance policies.
The parliamentary standing committee and the finance minister AMA Muhith had been at loggerheads over the issue of Islamic and general insurance laws.
The finance minister wanted separate companies to operate traditional and Islamic insurance policies, but the majority committee members pressed ahead with the act that allows a company to pursue both.
The minister put forward his suggestion but rest of the members of the committee unanimously rejected it, said AHM Mostafa Kamal, chairman of body, on Thursday after a meeting of the committee.
Mr Muhith suggested that a company cannot run Islamic and traditional life insurance operations simultaneously, but the committee recommended otherwise and the bills will be placed before the house on Sunday, he said.
Earlier, before the announcement of the current budget, finance minister and the standing committee locked in a battle over the tax holiday issue.
"The minister is a member of the committee and as an individual he can express his opinion but the committee will accept the decision of the majority," Mr Kamal explained.
There is no distance between the committee and the minister, he said adding, "We have a very good relations."
Capital of life insurance will be increased to Tk 300 million from Tk 75 million and non-life insurance will be raised to Tk 400 million from Tk 150 million, the chairman said.
"The timeframe to raise the capital will be fixed after formulating the rules," he said.
The number of directors will be 20, but the ministry proposed to limit the number to 15.
"The Securities and Exchange Commission has fixed maximum 20 directors of a listed company and we follow the stock market watchdog body's guideline," he added.
There are 62 insurance companies are operating in the country and they need to be regulated under comprehensive laws and guidelines and supervised by a strong regulatory authority, Mr Kamal said.
The insurance companies earned Tk 42.5 billion in premium last year and there is ample scope to expand the business manifold.
Finance Minister AMA Muhith on July 9 placed the two bills before the Jatiyo Sangsad (JS) to pave the way for strengthening the regulatory process of the insurance sector.
The parliamentary standing committee on finance has finalised two insurance bills -- The Insurance Act 2009 and The Insurance Regulatory Authority Act 2009 -- and it is expected to be passed in the current session, Mr Kamal said at a press briefing Thursday.
The proposed Insurance Act 2009 said the sector needs to be managed properly and be strengthened by reducing business risks, and local and international insurance laws need to be harmonised considering the socio-economic aspect of the country.
The Insurance Regulatory Authority Act 2009 said there is an increasing need to regulate one of the largest sectors in the country, harmonise local and international insurance laws considering the socio-economic aspect of the country, and protect the interest of policy-holders and other related beneficiaries.
Once the proposed insurance act is passed by parliament a life insurance company can pursue both traditional and Islamic insurance policies.
The parliamentary standing committee and the finance minister AMA Muhith had been at loggerheads over the issue of Islamic and general insurance laws.
The finance minister wanted separate companies to operate traditional and Islamic insurance policies, but the majority committee members pressed ahead with the act that allows a company to pursue both.
The minister put forward his suggestion but rest of the members of the committee unanimously rejected it, said AHM Mostafa Kamal, chairman of body, on Thursday after a meeting of the committee.
Mr Muhith suggested that a company cannot run Islamic and traditional life insurance operations simultaneously, but the committee recommended otherwise and the bills will be placed before the house on Sunday, he said.
Earlier, before the announcement of the current budget, finance minister and the standing committee locked in a battle over the tax holiday issue.
"The minister is a member of the committee and as an individual he can express his opinion but the committee will accept the decision of the majority," Mr Kamal explained.
There is no distance between the committee and the minister, he said adding, "We have a very good relations."
Capital of life insurance will be increased to Tk 300 million from Tk 75 million and non-life insurance will be raised to Tk 400 million from Tk 150 million, the chairman said.
"The timeframe to raise the capital will be fixed after formulating the rules," he said.
The number of directors will be 20, but the ministry proposed to limit the number to 15.
"The Securities and Exchange Commission has fixed maximum 20 directors of a listed company and we follow the stock market watchdog body's guideline," he added.
There are 62 insurance companies are operating in the country and they need to be regulated under comprehensive laws and guidelines and supervised by a strong regulatory authority, Mr Kamal said.
The insurance companies earned Tk 42.5 billion in premium last year and there is ample scope to expand the business manifold.
Finance Minister AMA Muhith on July 9 placed the two bills before the Jatiyo Sangsad (JS) to pave the way for strengthening the regulatory process of the insurance sector.