Two non-life insurance cos face music

The Insurance Development and Regulatory Authority (IDRA) has recently fined two non-life insurance companies for doing business on credit and cash and violating tariff rate.
The insurance regulator also warned another non-life insurer and concerned chief executive officer (CEO) and branch manager against irregularities, said a press release issued by the IDRA.
The companies are Provati Insurance Company Ltd, Eastern Insurance Company Ltd and Standard Insurance Company Ltd.
The fines were imposed after hearing on the allegations held at the office of the regulator. IDRA acting chairman Md Fazlul Karim, its member Md Quddus Khan, CRC's senior consultant AKM Iftekhar Ahmed and concerned officials from the insurers were present at the hearing.
An IDRA inspection team visited the Senakalyan branch in Dhaka and Dewanhat branch in Chittagong of Provati Insurance on May 7, 2012 and April 24, 2012 respectively, and found some irregularities regarding money receipt, bank deposit slip, premium registrar and bank statement.
During the hearing, the insurer could not satisfy the IDRA authorities against the alleged irregularities. However, considering the instances at the branches as the first ones, Provati Insurance's chief executive officer and the branches' managers were just warned against the irregularities.
Visiting the Faridpur branch of Eastern Insurance on July 18, 2012, an IDRA inspection team also found business on credit by scrutinising the money receipt, bank deposit slip, policy cover note and bank statement.
During hearing on the irregularities, the company placed its explanation that also failed to satisfy the IDRA authorities. After the hearing, the regulator fined Tk 50,000 to Eastern Insurance for doing business on credit.
At the same time, it warned the branch manager for stopping the business on credit and asked the CEO to intensify monitoring measures to scotch irregularities in the branches.
The Standard Insurance Company was also fined Tk 100,000 at the hearing for doing business on credit and transaction on credit and cash, and its Karwan Bazar branch manager was also fined Tk 50,000 for violating tariff rate. The CEO of the company was also asked to strengthen monitoring.
Visiting Standard Insurance's head office in Dhaka on August 4, 2013, an IDRA inspection team found business on credit, tariff rate violation, cash transaction of over Tk 5,000.
However, the company could not satisfy the IDRA authorities, and as such the fine was imposed after hearing on the allegations, the press release said.