The Insurance Development and Regulatory Authority has asked all insurance companies to comply with rules by raising shareholdings by their sponsors to 60 per cent in their respective companies and the companies’ minimum paid-up capital to Tk 30-40 crore within one month.
IDRA issued letters to the companies on Sunday in this regard.
In the letter, IDRA asked the insurance companies to comply with section 21(3) of Insurance Law, 2010 within a month.
According to the rules, an insurer, incorporated in or outside Bangladesh before the commencement of this act, must have a minimum paid-up capital of the amount specified in schedule-1.
For life insurance companies, the paid-up capital must be at least Tk 30 crore of which 60 per cent must be subscribed by the sponsors and the remaining 40 per cent must remain open for public subscription, according to the schedule-1.
For non-life insurance companies, paid-up capital must be at least Tk 40 crore of which 60 per cent must be subscribed by the sponsors and the remaining 40 percent must remain open for public subscription.
Of the 49 listed life and non-life insurance companies, only five companies have more than 60 per cent shares held by their sponsor-directors.
The five companies are Crystal Insurance Company, Dhaka Insurance, Express Insurance, Reliance Insurance and Bangladesh National Insurance Company.
Want stories like this in your inbox?
Sign up to exclusive daily email
More Stories from Miscellany