New insurance laws approved
Friday, 20 July 2007
The interim cabinet Wednesday approved, in principle, the Insurance Act 2007 and Insurance Regulatory Authority Act 2007 to discipline the Tk 30 billion insurance industries, reports bdnews24.com.
"It will make the insurance rules contemporary," said a government statement.
An Insurance Regulatory Authority, headed by a chairman, will oversee the insurance companies and safeguard interests of policyholders.
It will replace the Department of Insurance.
The new insurance law will force companies, both general and life insurance companies, to increase paid-up capital, expand their businesses in rural or social sectors and restrict the board of directors to 20 members.
The government moved to revise the century-old laws to regulate the industry that is composed of some 62 Companies operating under the antiquated Insurance Act 1938 and the Insurance Rule 1958.
"The new laws will replace the existing acts," said Mahfuzul Haque, chief controller of insurance.
The IRA will run on its own fund and renew, approve, suspend or cancel registration, levy fees and impose penalties.
It will also look after the issues of amalgamation or merger between companies.
The Insurance Act 2007 makes it manadatory for general and life insurance companies to raise their minimum paid-up capital to Tk 250 million (25 crore) and Tk 150 million from Tk 150 million and 70.5 million respectively.
The law also provides for a "protection fund" to safeguard interests of life insurance policyholders.
"It will make the insurance rules contemporary," said a government statement.
An Insurance Regulatory Authority, headed by a chairman, will oversee the insurance companies and safeguard interests of policyholders.
It will replace the Department of Insurance.
The new insurance law will force companies, both general and life insurance companies, to increase paid-up capital, expand their businesses in rural or social sectors and restrict the board of directors to 20 members.
The government moved to revise the century-old laws to regulate the industry that is composed of some 62 Companies operating under the antiquated Insurance Act 1938 and the Insurance Rule 1958.
"The new laws will replace the existing acts," said Mahfuzul Haque, chief controller of insurance.
The IRA will run on its own fund and renew, approve, suspend or cancel registration, levy fees and impose penalties.
It will also look after the issues of amalgamation or merger between companies.
The Insurance Act 2007 makes it manadatory for general and life insurance companies to raise their minimum paid-up capital to Tk 250 million (25 crore) and Tk 150 million from Tk 150 million and 70.5 million respectively.
The law also provides for a "protection fund" to safeguard interests of life insurance policyholders.