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ISO 9001 : 2008 Certified

ISO 9001 : 2008 Certified. Landscape of Micro Insurance In Bangladesh- Poverty Alleviation and Need for Mutual Micro Insurance. K. M. MORTUZA ALI (A.C.I.I.). Managing Director. PRIME ISLAMI LIFE INSUARANCE LTD. E-mail : mortuzaalimd@yahoo.com. BANGLADESH. BANGLADESH.

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ISO 9001 : 2008 Certified

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  1. ISO 9001 : 2008 Certified

  2. Landscape of Micro Insurance In Bangladesh- Poverty Alleviation and Need for Mutual Micro Insurance K. M. MORTUZA ALI (A.C.I.I.) Managing Director PRIME ISLAMI LIFE INSUARANCE LTD. E-mail : mortuzaalimd@yahoo.com

  3. BANGLADESH

  4. BANGLADESH

  5. INSURANCE INDUSTRY OF BANGLADESH

  6. INSURANCE INDUSTRY OF BANGLADESH

  7. REGULATORY FRAMEWORK 1. Insurance Act 2010 prohibits carrying on insurance business without registration from Insurance Regulatory Authority. 2. Micro Credit Regulatory Authority Act on the other hand allows MFI’s & NGO’s to provide insurance service to borrowers/members. 3. There is no specific rules/regulations for micro-insurance in Bangladesh. 4. A consultative committee is now working for framing rules and regulation for industry players in line with international best practices.

  8. STRUCTURE OF THE POPULATION IN BANGLADESH 1. Private Informal 35% 2. Private Formal 4% 3. Public/Autonomous sector 2% 4. Children (10-14) 14% 5. Children < 10 29% 6. Students 12% 7. Disabled & Retired 3% 8. Unemployed 1%

  9. POVERTY & SECURITY

  10. POVERTY & SECURITY

  11. WHAT, HOW, WHY OF MI. (FINDING OF SURVEY)

  12. WHY WE NEED MICRO INSURANCE? • BECAUSE: • The poor need protection & economic security. • 2. There is demand for insurance among MC beneficiaries.

  13. WHO CAN PROVIDE INSURANCE SERVICE TO POOR PEOPLE? • Concerned MFI-NGO. • 2. Govt. through social insurance scheme. • 3. Commercial insurer by offering specially designed product for poor. • 4. Mutual association/club.

  14. WHO SHOULD PROVIDE?

  15. MICRO INSURANCE PRODUCT OF N.G.O-MFIS/CUM INSURER

  16. WEAKNESSES OF MFI’s SCHEMES • The basic principle of spreading the risk is defeated. • 2.The fund, which is built up may not be sufficient to meet the large and unusual losses. • 3.There is no protection form reinsurance and absence of pooling arrangement. • 4. Non-availability of talent needed for underwriting, claim and fund management. • 5. If insurance reserve fund is not set aside and only a book reserve is made the purpose is defeated.

  17. COMPARATIVE ADVANTAGES/DISADVANTAGES OF DIFFERENT PROVIDERS

  18. WHAT SHOULD BE DONE? • MFI-NGO’s to formulate strategic plans for providing micro insurance. • 2. Mutual association to be formed. • 3. Package policy to be designed. • 4. Micro insurance to be linked with credit where necessary. • 5. Product to be offered on group basis. • 6. Support from Govt. & donors will be required. • 7. Support of commercial insurer will help to increase efficiency.

  19. HOW TO PROMOTE M.I.? • Follow professionalism and best practices. • 2. Formulate appropriate laws and regulations. • 3. Consumer education and awareness programme among lower income groups. • 4. Limit moral hazard and fraud through Training & Punitive actions.

  20. WHAT SHOUD BE DONE FOR SOUND MANAGEMENT PRACTICES? • Policy documents be made simple and easy. • 2. Claim process be simple while still controlling fraud. • 3. Rewards and punishments to discourage abusive practices. • 4. Quality must not be compromised with quantity. • 5. Operational cost to be kept at minimum. • 6. Takaful models may be followed.

  21. CONCLUDING MESSAGE • Conceptually Mutual Insurance is in harmony with the central philosophy of Takaful. • Therefore, micro-takaful appears to be an alternative solution to meet the insurance needs of the poor as a means of poverty alleviation.

  22. Thank You CORPORATE OFFICE Raj Bhaban (6th Floor), Dilkusha C/A, Dhaka-1000, Bangladesh. Tel : 88-02-9554538, 7160074, 9560889. Fax : 88-02-9564390 E-mail : plicl@bdonline.com, Web : www.primeislamilifebd.com

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