Introduction: The insurance industry in the country was nationalized in 1972 and two government corporations- SadharanBima Corporation

and JibanBima Corporation were set up for general and life insurance respectively. All existing companies except American Life Insurance Company (ALICO) were merged into these two corporations. The nationalized state of Bangladesh insurance market continued until 1985 when the government had change in policy and allowed setting up of insurance company by private sector. Over the year, a good number of life and general insurance were in phases. Currently, in addition to the two government corporations, 17 life insurance and 43 general insurance companies are operating in the country. Total Insurance market premium of Bangladesh in 2003 was Tk. 5878.18 or US$ 100.39 million and Tk. 1,252.82 or US$ 21.39 million approximately on general i.e. non-life and life insurance respectively. (Development of insurance sector in Bangladesh)

What is insurance? In case of Bangladesh The Insurance Act, 2010 in replacement of the Insurance Act, 1938, and the Insurance Development and Regulatory Authority Act, 2010 for establishing the Insurance Development and Regulatory Authority (IDRA), were passed by the JatiyaSangshad in March, 2010. Insurance is an arrangement by which a company or the state undertakes to provide a guarantee of compensation for specified loss, damage, illness or death in return for payment of a specified premium. (((self definition)))
Insurance Products
o o o o o

Life Insurance , Vehicle Insurance, Home Insurance, Health or Medical Insurance Travel Insurance, etc.

Types of insurance

Life insurance:Life insurance or life assurance is a contract between the policy owner and the insurer, where the insurer agrees to pay a sum of money upon the occurrence of the insured individual's or individuals' death or other event, such as terminal illness or critical illness. In return, the policy owner agrees to pay a stipulated amount called a premium at regular intervals or in lump sums. There may be designs in some countries where bills and death expenses plus catering for after funeral expenses should be included in Policy Premium. In the United States, the predominant form simply specifies a lump sum to be paid on the insured's demise.

General insurance or non-life insurance policies, including automobile and homeowners policies, provide payments depending on the loss from a particular financial event. General insurance typically comprises any insurance that is not determined to be life insurance

Insurance company in Bangladesh

There are 2types of insurance company in Bangladesh:

Life insurance Company: Public, Foreign, Private. General insurance company: Public, Private. After independence, Bangladesh government nationalized the insurance industry in 1972 by the Presidential Order No 95, known as the Bangladesh Insurance (Nationalization) Order 1972.A total of 60 insurance companies are operating in Bangladesh till date. Of these companies, 57 are private, two state-owned and one is foreign

((Insurance industry of Bangladesh)

1.2 Objectives and scope of the case The research objectives regarding my term paper are To fulfill the requirement of the course curriculum. To find out some major problems of insurance in Bangladesh as follows Social Political Economical Legal Miscellaneous To identify the major prospective area of insurance in Bangladesh as follows Social Economical The preparation of the case will enable to gather concept of the insurance business. To suggest or recommend some necessary steps to solve the existing problems. To suggest necessary steps to develop this business in a developing country like Bangladesh. term paper This type of case study will enhance our overall knowledge about insurance and help us further to prepare any documents regarding insurance. We think this case study will also be beneficial for those people who need information about insurance. 1.3 Methodology Secondary sources of data will be used for data requirements of the report.Secondary sources of data: Use Internet and different articles published in the journals& magazines have been used.Secondary Sources are: Textbooks on insurance Insurance Journals. Reference books on insurance. Annual Reports of BGIC. Internet Books. Annual report of insurance companies. 1.3(1)Total population of Bangladesh: 163,654,860 (July 2013)Bangladesh is largely ethnically homogeneous. Bangladesh has the highest population density in the world. About 89% of Bangladeshis are Muslims, followed by Hindus (8%), Buddhists (1%) and Christians (0.5%). The 2011 total population was 152,518,015 which ranks Bangladesh 8th in the world.

en.wikipedia.org/wiki/Demographics_of_Bangladesh

1.3(2)tested area: We selected only Dhaka city because Dhaka is the capital of Bangladesh.. Located on the east banks of the Buriganga River in the heart of the Bengal delta, Dhaka has an estimated population of more than 15million people, making it the largest city in Bangladesh and the 8th largest city in the world. Dhaka is also one of the world's most densely populated cities. http://en.wikipedia.org/wiki/Dhaka 1.3(2)sample: we survey 5 number of insurance companies and hastaken oral interview about the development of insurance industry of Bangladesh such as Pragati Insurance Ltd, American Life Insurance Company (Foreign Company), Delta Life Insurance Company Ltd,Sunlife Insurance Company Ltd andAgrani Insurance Company Ltd. Number 1 2 Company name Pragati Insurance Ltd American Life Insurance Company (Foreign Company) 3 Delta Life Insurance Company Ltd 4 Sunlife Insurance Company Ltd 5 Agrani Insurance Company Ltd www.(Self idea).com No. of employee 2 4 3 2 2 No. of customer 20 25 25 15 10

1.4 Limitations Preparing the term paper I have faced some obstructions which are 1. Lack of proper information in the websites of the insurance company. 2. Lack of necessary information in the journals and official publications of insurance companies. 3. Inexperience and time constraint is the limitation restricting this report from being more detailed. Secondary data has been collected from the hand books, magazines, which may biased to the insurance business

Historical Background of insurance Industry in Bangladesh Insurance is not new business in Bangladesh. Almost a century back, during British rule in India, some insurance companies started transacting business, both life and general, in Bangal. Insurance business gained momentum in East Pakistan during1947-1971, when 49 insurance companies transacted both life and general insurance schemes. These companies were of various origins like British, Australian, Indian, West Pakistan and local. Ten insurancecompanies had their head offices in EastPakistan, 27 in West Pakistan, and rest elsewhere in the world. These were mostly limited liability companies. Some of these companies were specialized on dealing in a particular class of business, while others were composite companies that dealt in more than one class of business. The Government of Bangladesh nationalized insurance industry in 1972 by theBangladesh Insurance (Nationalization) Order 1972.By virtue of this order, saves andexcept postal life insurance and foreign life insurance companies, all 49insurancec o m p a n i e s andorganizations transacting insurance business in the country were placed in the sector under fie operations. These operations were:theJatiyaB i m a Corporation,TistaBima Corporation, KarnafuliBima Corporation, RupsaJibonBima Corporation and SurmaJibonBimaCorpporation. The JatiyaBima Corporation was an apex corporation only to supervise and control the activities of the other insurance corporations which were responsible for under writing. Tista and KarnafuliBimaCorporation were for general insurance and Rupsa and Surma for life insuance. The specialist life insurance companies or for a life portion of a composite company joined the Rupsa and Surma corporations while specialist general insurancecompanies or the general portion of a composite company joined The Tista andKarnafulicorporations. The basic idea behind the formation of four underwriting corporations, two in each main branch of life and general, was to encourage competition even under nationalized system. But the burden of administrative expenses incurred inmaintaining two corporations in each front of life and general and an apex institutionat the top outweighed the advantages of limited competition. consequently, on 14 May1973,a restructuring was made under the Insurance Corporations Act 1973. Following the Act, in place of five corporations the government formed two: the SADHARANBIMA CORPORATION for general business, and JIBAN BIMA CORPORATION for life business.The postal life insurance business and the life insurance business by foreigncompanies were still allowed to continue as before .In reality, however, only theAMERICAN LIFE INSURANCE COMPANY continued to operate in the life sector 3for both new business and servicing, while three other foreign life insurancecontinued to operate only for servicing their old policies issued during Pakistan days.Postal life maintained its business as before.After1973, general insurance business became the sole responsibility of the SadharanBima Corporation. Life insurance business was carried out by the JibonBimaCorporation, the American Life insurance Company, and the Postal Life Insurance Department until 1994, when a change was made in the structure arrangement to keep place with the new economic trend of liberalization.The insurance corporations Act1973 were amended in 1984 to allow insurancecompanies in the private sector to operate side by with SadharanBimaCorporation andJibanBimaCorporation.The Insurance Corporations Amendment Act 1984allowed floating of insurance companies, both life and

general, in the private sector subject to certain restrictions regarding business operations and reinsurance. Under the new act, all general insurance business emanating from the public sector were reserved for the state owned SadharanBima Corporation, which could also underwriteinsurance business emanating from the private sector. The Act of 1984 made it a requirement for the private sector insurance companieso obtain 100% reinsurance protection from the SadharanBimaCorporation. This virtually turned SadharanBimaCorporation into a reinsurance organization, in addition to its usual activities as direct insurer.SadharanBima Corporation itself had the right to reinsure its surplus elsewhere outside the country out after exhausting the retention capacity of thedomestic market. Such restrictions aimed at preventing outflow of foreign exchange in the shape of reinsurance premium and developing are insurance market within Bangladesh. The restriction regarding business placement affected the interests of the private insurance companies in many ways. The restrictions were considered not congenial to the development of private sector business in insurance. Two strong arguments were put forward to articulate feelings: Since the public sector accounted for about 80% of the total premium volume of the country, there was little premium left for the insurance companies in the private sector to survive. In this context, SadharanBima Corporation should not have been allowed to compute with the private sector insurance companies for the meager premium (20%) emanating from the private sector; Being a competitor in the insurance market, SadharanBima Corporation was hardly acceptable as an agency to protect the interest of the private sector insurance companies and should not have retained the exclusive right to reinsure policies of these companies. The arrangement was in fact, against the principle of laissez faire.Private sector insurance companies demanded withdrawal of the above restrictions so that they could: Underwrite both public and private sector insurance business in competition with the SadharanBima Corporation, and The government modified the system through promulgation of the Insurance Corporation (Amendment) Act1990.The changes allowed private sector insurance companies to underwrite 50% of the insurance business emanating from the public-sector and to place up to 50% of their reinsurance with any reinsure of their choice, at home or aboard, keeping the remaining for placement with the SadharanBimacorporation Brifly we describe the overall background of insurance industry in Bangladesh Triton insurance ,Calcutta pioneer in general insurance ,established in 1850 Oriental life assurance company, the first life insurance company, established in 1818 Were generally limited to the British people working in India Insurance business exclusively operated by private sector In Pakistani period On 14th May, 1973 the Insurance Corporation Act VI, 1973 was enacted and five corporations were abolished into the following two corporations 1) SadharanBima Corporation for General Insurance

2) JibanBima Corporation for Life Insurance

Present situation of insurance industry in Bangladesh

In Bangladesh, the Insurance business, after and early stage of dislocation, adventureand experimentation through half a century has now being established as a nascentindustry distributed between the public and private sectors. Insurance businessevolved in the Indian subcontinent late in nineteenth century when several businesscompanies started their business and a few Christian missionaries began to operatemutual funds to serve their own community members. From Bangladesh perspectiveinsurance business was not a promising sector in its early age but it is getting its paceday by day with the growth of overall economic condition of the country.The privatization policy adopted in the 1980s paved the way for a number of insurersto emerge in the private sector. This resulted in a substantial growth of premiumincomes, competition, improvement in services, and introduction of newer types of business in wider fields hitherto untapped.Up to 2000, the government has given permission to 19 general insurance companiesand 10 life insurance companies in the private sector. Insurers of the country nowconduct almost all types of general and life insurance, except crop insurance andexport credit guarantee insurance, which are available only with the ShadharanBimaCorporation. Numerous institutions, associations and professional groups work to promote the development of insurance business in Bangladesh. Prominent amongthem is the Bangladesh Insurance Association (formed on 25 May 1988) having 30members. It aims at promoting, supporting and protecting the interests and welfare of the member companies. Another example is Bangladesh insurance academy.Surveyors and insurance agents occupy a prominent position in the insurance marketof Bangladesh. The system of professional brokers has not yet developed inBangladesh. A total of 60 insurance companies are operating in Bangladesh till date.Of these companies, 57 are private, two state-owned and one is foreign.Insurance Directorate, under the Ministry of Commerce, is the regulatory-body of thecountry's insurance sector. At present there are 44 general insurance companiesrunning in Bangladesh. Many other private companies are about to commence business. http://www.scribd.com/doc/20131763/overall-insurance-company%E2%80%99s-problems-andprospects-in-Bangladesh

Shortly we describe the present situation of insurance industry in bangladesh

62 insurance companies. 2 state-owned corporations 43 general & insurance companies 17 life insurance companies

SBC was acting as the sole insurer of general Insurance till 1984 Bangladesh Government allowed the private sector to conduct business in all areas of insurance for the first time in 1984 At present, nearly all the companies place 100% of their reinsurance business with the SBC.

(((Presentation slide)))

Basic operations of insurance company in Bangladesh

Primary

To spread the financial loss of insured members over the whole of the insuring community by compensating the unfortunate few from the pool formed by the contributions of all members.

Secondary

Freeing funds otherwise tied up in reserves - Insurance substitutes a certain premium payment in place of an uncertain loss payment. No prudent businessman would invest large sums of money without suitable safeguards. In the absence of insurance, large reserve funds would be necessary. Insurance has the effect of releasing these reserves for further investment and developments. Investment by insurers - Insurers have accumulated funds over the years and a large proportion of these resources are invested, therefore boosting the overall development of the economy. Aid to credit - Seldom will a loan be advanced unless the item being financed is insured. Provides employment - A large number of people are directly employed in the insurance industry.

Loss prevention and loss reduction - Insurers encourage loss reduction and prevention by offering lower rates and discounts to those who take loss prevention and loss reduction measures.

Registration policy in an insurance company Complete the registration form provided and mail together with the company cheque or any other modes of payments except personal cheques to reach 30 DAYS BEFORE the course commences.

Participants will only be registered upon clearance of the cheque.

Reservation for the course can be made by phone or fax but will be confirmed upon receipt of the registration form and payment.

A FULL FEE is chargeable if no written notice of cancellation is received 14 DAYS before the course commences or if the participant fails to report for the course. However, we accept substitute participant (s). The organizer reserves the right to reschedule or cancel the course due to unforeseen circumstances and will notify the contact person accordingly.

Confirmation of the course will be made to the contact person/registered participant(s). Registration Form

Operations of insurance company graphically

The increasing rate of insurance policy in BD

How prepare the case study Course of action: Course action Preliminary stage investigation and analysis stage Prior to submission About the time: Data collection Define and analysis of data Prepare the case properly Budget: Research components Survey Interview Transportation cost Report writing Researcher profile: Sha md Ali Rana. I am a student of southeast university,Department of BBA and Total CGPA(3.88). I am a group leader. Faisal Ahamed I am a student of southeast university,Department of BBA and Total CGPA(3.91). Md.nuruzzaman I am a student of southeast university,Department of BBA and Total CGPA(3. ). Rakib khan I am a student of southeast university,Department of BBA and Total CGPA(3. ). Cost 1000 700 500 400 Total 2600 we needed one moth for collecting the data. we analysis the data 15 days for preparing the case we needed 2 weeks. Activities Data collection Define and analysis of data Prepare the case properly

Conclusion: In present insurance is too much important to the business and individual sector. Most of the companies provide more or less same services. For this reason the competition is increasing day by day between the insurance companies. On the other hand some new insurance companies are going to start businesses in the competent market. BGICneed to develop their some productive sectors. In present, a company cannot establish properly without developing information technology. People search their desires requirement through Internet so, insurance companies need to develop Web address to i n c r e a s e both foreign and local investors. So we have discussed about both the problem and prospects of insurance business in Bangladesh. The progress of insurance business depends on the progress of economic condition .Insurance business also faces many problem. So if we develop economic condition as well as overcome the problems, it will help a lot to flourish this business in our country