The country’s insurance sector is facing an acute shortage of Chief Executive Officers (CEOs) as the industry seriously lacks efficient manpower for the top positions.
Currently, some 20 insurance companies are running without CEOs for last eight months to one-year period that goes beyond the rules.
According to the insurance companies act, the CEO post cannot remain vacant for more than three months. However, Insurance Development and Regulatory Authority (IDRA) has the authority to extend the period by three more months.
Of the companies, nine are life insurance and 11 non-life insurance companies.
The life insurance companies are – Chartered, NRB Global, Guardian, Alpha, Homeland, Baira, Trust, Padma and Zenith.
The general insurance companies are – United, Union, Express, Global, Northern, Purabi, Mercantile, Rupali, Standard, South Asia and SenaKalyan.
The insurance companies are running without CEOs for more than six months although they have been asked thrice by IDRA to comply with the rules.
The authority decided to take action against the insurance companies those failed to appoint CEOs, despite repeated warnings, said a senior official of IDRA.
As part of the move, IDRA is scheduled to hold a hearing next month on the board of Padma Islami Life Insurance over the issue of vacant CEO position for a year.
“The board of the companies would be penalised over the issue after the hearing,” said an official of IDRA.
The authority will call other companies, who have failed to appoint CEOs within six months, for hearing and will take strong action against them, said a member of IDRA.
Moreover, IDRA found some CEOs, who are allegedly possessing fake higher education certificates.
The authority also primarily uncovered the authenticity of allegation of the fake certificates and moved to continue further investigation about the matter, according to IDRA source.
A section of insurance companies are also allegedly appointing their respective Chief Executive Officers (CEOs) by grossly violating the existing recruitment rules.
Progressive Life Insurance appointed Abul Bashar Akond as CEO in October last year without getting any prior approval from IDRA.
Abul Bashar Akond, who had earlier served the NRB Global Insurance, holding the same position, failed to submit the required documents to the authority.
As a result, IDRA rejected his appointment in December last year. In this perspective, the company asked the CEO to pay back the money that he received as salaries and allowances within three months.
IDRA also canceled the re-appointment of Sunflower Life Insurance CEO Zakir Hosain and Fareast Islami Life Insurance CEO Hemayet Ullah for not following the proper procedures in appointing them as CEOs.
The board of directors of United Insurance faced financial penalty recently imposed by IDRA for violating rules in appointing managing director.
The board of the insurance company has reappointed the CEO Syed Shahriyar Ahsan till the year 2016, without taking approval of IDRA.
The company informed the authority about the reappointment after eight months of taking decision.
As per the Insurance Act 2010, an insurance company will have to inform the authority in written about MD appointment or removal within 15 days of taking decision.
IDRA has fined a total of Tk8 lakh to eight directors of the company including its chairman Syed Aziz Ahmad, board member Saiful Islam, Shah Alam, M A Azim, Harunur Rashid, M Alam, Hafizullah and Wahiuddin Mahmood with Tk1 lakh each.
Currently, a total of 75 insurance companies are operating in the market. Of the companies, 45 general insurance and 30 life insurance.
Of the insurance 16, new companies have been allowed during the tenure of the incumbent government.
The number of insurance companies, though, increased rapidly but the sector is sufferings in doing good business due to the shortage of efficient manpower, said a senior executive of a private insurance company.
