Increasing capacity of State Insurance Corporation General Insurance Corporation (SBC) and Life Insurance Corporation (JBC) As part of that, the paid up capital of the two companies has been increased. The Board of Directors is also increasing. For 46 years, the insurance corporation law will be formulated again.
On 6 March, the Parliament presented a bill of Insurance Corporation Act, 2015, to the Finance Minister AHM Mustafa Kamal. Earlier on December 3, 2018, the Cabinet approved the draft of the Act. Parliamentary Standing Committee on Finance Ministry discussed this on Tuesday. The existing Insurance Policy Act, 1973 will be canceled automatically if the new insurance corporation passes the legislation.
Sheikh Kabir Hossain, president of Bangladesh Insurance Association (BIA), an insurance company’s owners, said, We welcome the new legislation to increase the capability of two corporations, including increase in capital. Its positive impact will be in the entire insurance sector. But making the law is not enough. The law must be implemented properly. The implementation of the IDRA is the key to implementation.
Under the new law waiting for passage, the authorized capital of SBC will be 500 crores and the paid up capital will be Tk 125 crores. On the other hand JBC’s authorized capital will be 300 million and the paid up capital will be 30 crore taka. The government can change the authorized and paid capital at any time.
In a press conference before joining the World Bank and International Monetary Fund (IMF) in the spring meeting, the Finance Minister said that SBC and JBC should have more capital. Their approved capital is TK.1 billion and the paid up capital should be 500 crore taka. The authorized and paid-up capital of both the companies will now make Tk 20 crores.
SBC and JBS are now seven members of the Board. The new law makes it 10 members. The chairman nominated by the government and four members of the joint secretary level will be in the board. Among the four, the Finance Ministry will have two financial institutions, one each from Finance Division and one from the Ministry of Commerce. Outside, two insurers and a certified accountant, who are experienced in managing insurance business, Apart from this, the Board of Directors of the Bangladesh Insurance Academy and the Managing Director of their respective organization (MD) will be the member of the ex-office.
The directors will be recruited for three years and will be eligible for reappointment for a term. Five members will be present for quorum at the Board meeting, currently three-member attendance takes place.
Currently, there is a maximum penalty of Tk 1 lakh for the violation of the re-sectional clause. It is making 5 lakhs of new laws.
According to the statement of the purpose and cause of the new law, 33 of the new laws, it is said that the capital of the corporation, according to the 1973 law, is very inadequate compared to the current requirement. So the initiative for expansion of capital has been taken.
General Insurance Corporation Managing Director Syed Shahriar Ahsan said that if the new law is passed, it will be possible to provide more services to both the organizations.
IDR chairman Shafiqur Rahman Patwari said, We will fulfill the responsibility of implementing the law. But we also think the paid-up capital of two corporations should be 500 crore tk.