The commercial banks that are willing to start bancassurance business with the insurance firms would have to establish a separate wing for dealing with the clients.
According to a draft guideline, which is being prepared by the Bangladesh Bank and at its final stage, the wing will have to have some manpower specialised in the insurance industry.
The bancassurance, a partnership between the banks and insurers, is to promote insurance business through selling insurance plans to the bank clients.
The Financial Institutions Division (FID) of the Ministry Finance wants to introduce the model which, many believe, would generate revenues for both banks and insurers.
According to the draft guideline, an officer holding a masters degree and having 12 years of experience in banking or insurance will be eligible for leading the wing as Chief Bancassurance Officer (CBO).
His grade will be within the five but below the CEO of the banks. He will require certifications and training for the post. The CBO will not have any disqualification in accordance with the Bank Company Act of 1991.
The wing will have some bancassurance officers or insurance executives having at least bachelor degree and necessary training on insurance. The banks will have to make sure that the bancassurance officers or insurance executives are properly trained on the model.
The wing, however, would not be able to force any customer to take the insurance policy. It can offer the insurance products to the retail customers and SME clients, but not to corporate customers.
The officers cannot provide any misleading information to the bank clients to sell the products, and will disclose that the bank will not take any risk-related liabilities.
Bancassurance began in France in the 1970s. The neighbouring countries also introduced the same at least two decades back.
Bangladesh has now privately-owned 34 life insurance and 45 non-life insurance companies. There are two more state-owned life and non-life entities.
Bangladesh has 60 commercial banks with around 11,000 branches across the country.
