Bancassurance in the offing

Bangladesh Bank and the Financial Institution Division have agreed to launch bancassurance, which is an arrangement between a bank and an insurance company allowing the insurance company to sell its products to the banks’ clients.

As part of that move, the Financial Institution Division of the Finance Ministry held a meeting with the BB and the Insurance Development and Regulatory (IDRA) officials at the ministry on Tuesday. Abdullah Harun Pasha, additional secretary of the Financial Institution Division, chaired the meeting.

The meeting has taken a resolution that the BB will soon make a presentation on the bancassurance and its pros and cons before the finance minister and secretary so that the government can take a decision on the issue.

Speakers at the meeting agreed that the partnership arrangement between the banks and insurers can be profitable for both parties.

India has bancassurance and its market share increased to 56 percent from 27 percent between 2011 and 2019. On the other hand, insurance product sales by agencies dropped significantly.