The Bangladesh Textile Mills Association (BTMA) has called on the government to quickly settle pending insurance claims for textile mills affected during the July-August 2024 mass uprising, as the sector faces a deepening crisis.
It has also sought compensation for the affected industrial units.
In a letter, BTMA President Showkat Aziz Russell urged the Finance Adviser to immediately take steps to resolve the issue and submitted a set of recommendations aimed at accelerating the claims process, sources said.
While the association did not specify the number of factories impacted during the mass uprising, it claimed that many of its member factories faced widespread vandalism, looting, and arson, causing massive disruption to production and inflicting heavy financial losses on entrepreneurs.
Russell said most of the affected mills had comprehensive insurance coverage, including fire and related risks, through non-life insurance providers.
However, despite the passage of over a year since the incidents, there has been no visible progress in settling most the claims, he added.
In his letter, Russell noted that the affected industrialists are experiencing extreme frustration and uncertainty due to the lack of clear guidance from the insurance regulator on the issue.
The BTMA also fears that insurance companies may attempt to deny claims by invoking the "Riot and Civil Commotion" clause.
It has demanded a clear and transparent interpretation of the clause to prevent alleged misuse.
One of BTMA's key proposals includes the issuance of a circular, directing all non-life insurers to prioritise and resolve pending claims related to the mass uprising within 90 days of receiving the requisite documents in accordance with the Insurance Act, 2010.
To expedite the process, BTMA also suggested establishing a fast-track mechanism in collaboration with Sadharan Bima Corporation (SBC) to ensure swift clearance of the re-insurance component.
Due to the prevailing deadlock, factories are struggling to restart production, putting thousands of workers at risk of losing their jobs. This is not just a crisis for a few companies, but a serious threat to the country's overall economy, particularly the garment export supply chain, Mr. Russell said in the letter.
As of 2024, the number of BTMA member mills stands at 1,863, including 527 yarn mills, 994 fabric mills, and 342 dyeing, printing, and finishing units.
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