New insurance laws within this month
S M Jahangir | Saturday, 7 June 2008
After more than three years of exercise by the officials concerned, the country's insurance sector is set to receive a couple of new laws by the end of this month.
The laws, it is hoped, would help infuse dynamism into sector.
"We will be placing the revised drafts of two proposed insurance ordinances before the Council of Advisers shortly for approval. Hopefully, the proposed two new insurance ordinances would come into being by this month," a senior official said.
The new laws are: The Insurance Ordinance 2008, and The Independent Insurance Regulatory Authority Ordinance 2008.
A senior official informed the FE that the proposed drafts were almost ready as the commerce ministry was just fine-tuning those in line with the directive of the council of advisers.
An eight-member committee of experts, which was formed by the last BNP-led alliance government in 2004 to prepare draft of insurance laws were submitted to the government in December 2006.
Although the commerce ministry placed the drafts before the council of advisers several months back, the latter asked the ministry to place those after scrutiny.
However, the council turned down another proposal on enactment of "The 'Takaful' Ordinance" for Islami insurance companies, officials noted.
Following the directive from the council, the commerce ministry has prepared the Insurance Ordinance and The Independent Insurance Regulatory Authority Ordinance both in English and Bengali.
Officials, however, said the government had initiated to move to legislate new laws for streamlining the regulatory processes of the country's insurance business as the existing laws/rules are too old to serve the purpose.
According to the proposals, the proposed Insurance Ordinance 2008 will replace the existing Insurance Act 1938 and the Insurance Rules 1958, they said.
Some new provisions, including establishment of a policyholders' protection fund, enhancement of companies' capital base, creation of brokerage houses for insurance policies and requirement of minimum solvency margin, have been included in the proposed ordinance, they mentioned.
The laws, it is hoped, would help infuse dynamism into sector.
"We will be placing the revised drafts of two proposed insurance ordinances before the Council of Advisers shortly for approval. Hopefully, the proposed two new insurance ordinances would come into being by this month," a senior official said.
The new laws are: The Insurance Ordinance 2008, and The Independent Insurance Regulatory Authority Ordinance 2008.
A senior official informed the FE that the proposed drafts were almost ready as the commerce ministry was just fine-tuning those in line with the directive of the council of advisers.
An eight-member committee of experts, which was formed by the last BNP-led alliance government in 2004 to prepare draft of insurance laws were submitted to the government in December 2006.
Although the commerce ministry placed the drafts before the council of advisers several months back, the latter asked the ministry to place those after scrutiny.
However, the council turned down another proposal on enactment of "The 'Takaful' Ordinance" for Islami insurance companies, officials noted.
Following the directive from the council, the commerce ministry has prepared the Insurance Ordinance and The Independent Insurance Regulatory Authority Ordinance both in English and Bengali.
Officials, however, said the government had initiated to move to legislate new laws for streamlining the regulatory processes of the country's insurance business as the existing laws/rules are too old to serve the purpose.
According to the proposals, the proposed Insurance Ordinance 2008 will replace the existing Insurance Act 1938 and the Insurance Rules 1958, they said.
Some new provisions, including establishment of a policyholders' protection fund, enhancement of companies' capital base, creation of brokerage houses for insurance policies and requirement of minimum solvency margin, have been included in the proposed ordinance, they mentioned.