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The insurance regulator proposes changing regulations to empower itself to remove chief executive officers from insurance companies for the abuse of power and corruption.
If the recommended reforms to the regulations for the appointment to and removal of CEOs from insurance companies are brought into effect, the Insurance Development and Regulatory Authority (IDRA) will also be able to disqualify the corrupt individuals for appointments to different companies.
This will keep an individual from joining the top position in another company, having been dismissed from one company over irregularities.
IDRA officials say the proposed amendment will stop appointments of controversial people to the top management positions in the insurance sector.
In the existing regulations, only the company concerned has the power to remove its chief executive officer.
However, the new regulations will offer an opportunity to place arguments in one's favour before the removal decision is executed. If necessary, the IDRA will form a committee to investigate the allegations of corruption before deciding the punitive action.
The draft regulations are also aimed at solving the crisis of qualified candidates for the positions of CEO in the insurance firms.
As per the current requirements, aspirant candidates must have two years' work experience as additional managing director and 12 years' experience of working in the insurance sector.
The IDRA proposed relaxing the provision, allowing candidates with one-year experience as additional managing director or three years' experience as deputy managing director to vie for the top posts.
At the same time, applicants having one-year experience as additional managing director or 15 years' experience as deputy managing director in a private commercial bank will also be eligible for the CEO post of an insurance company.
As of now, individuals are not considered eligible for the top posts in insurance firms without any experience working in the sector.
The changes have been proposed against the backdrop of many insurers' operating for years under acting CEOs instead of CEOs, said Saifunnahar Sumi, spokesperson and media & communication consultant at the IDRA.
The regulatory body has published the draft regulations on its website, proposing amendments to the 2012 regulations. It has sought public opinions on the draft regulations within 15 days starting from June 26.
The IDRA also suggests that candidates will be treated equally irrespective of whether they have a foreign professional degree or a degree obtained from a local recognised institution.
CEOs will also have to apply for their reappointment two months before the expiry of their tenure, as per the draft regulations. The IDRA will make a decision within the two months on receiving an application.
The existing rules provide for the submission of an application 15 days prior.
The revised regulations will end the long-standing deadlock over the appointment of chief executives in the insurance sector, industry insiders say. At the same time, it will pave the way for the removal of corrupt individuals from top positions.
"IDRA is working to enforce greater accountability in the sector and protect the interests of policyholders," said Ms Sumi.
Bangladesh has 82 insurance companies -- 36 in the life insurance sector and 46 in the non-life insurance sector. Of them, 58 are publicly listed.
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