Life insurers report decline in premium growth in H1 2022

Growth of premium income by Bangladesh’s life insurance companies declined in the first half of 2022, thanks to the Russia-Ukraine war and its fallout amid rising commodity prices and inflationary pressure.

According to the Insurance Development and Regulatory Authority (IDRA), the gross premium income of all life insurance companies operating in the country rose by 4.34 percent year-on-year to Tk 4,606 crore at the end of June this year.

Though the industry rebounded well in 2021 after being impacted badly by the coronavirus pandemic in 2020 when the growth went down to negative territory, the declining business made the insurers concerned.

“Usually, business in the first half of a year remains dull and it gains momentum in the second half,” said a senior IDRA official, hoping that insurance companies’ income will increase in the second half.

Insurance executives, however, said their income has gone down as people and businesses are in a tight corner due to inflation and growing economic worries.

“Financial security got attention during the Covid-19 pandemic. People across the world took life insurance as one way to bolster their financial plans and protect their family’s financial future. But it was not the case for Bangladesh,” said a senior official of Delta Life, one of the largest local life insurance companies.

IDRA data shows the total premium of the industry was at Tk 10,260 crore in 2021, a nearly 8 percent increase from a year ago. Insurers witnessed negative growth in their premium income in 2020 when the world including Bangladesh was in lockdowns for days to curb the infection of Covid-19.

There are 33 life insurance companies operating in the country, including USA-headquartered Metlife and Indian Life Insurance Corporation.