Budget FY23: Four types of social insurance in the works

Finance Minister AHM Mustafa Kamal on Thursday said the government is working to introduce four types of social insurance in the country.

“These are unemployment insurance, maternity insurance, sickness insurance, and employment injury insurance,” the finance minister said while placing the national budget for FY23 in parliament.

“A study has already been conducted under the ‘National Social Insurance Scheme’, at the initiative of the Cabinet Division,” he said.

“The Ministry of Labor and Employment has already taken steps to launch a pilot of the Employment Injury Scheme to protect workers from injury in the workplace,” the minister added.

The government has also taken various other initiatives to use insurance services as a disaster management tool. As a part of the initiatives, steps have been taken to introduce crop insurance, livestock insurance, and health insurance for both government employees and the general public.

The finance minister also said the government is encouraging the introduction and widespread expansion of crop insurance.

“There is also a step to fully automating the insurance sector to ease the hassle of collecting the payouts of insurance claims. Steps will be taken to strengthen financial inclusion and promote national savings by increasing the coverage of insurance,” he said.

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Welcoming the government's steps to launch the schemes, Bangladesh Insurance Association (BIA) Chairman Sheikh Kabir Hossain told The Business Post that there is a need for united efforts of the government and private insurance companies to make the schemes popular among people.

"There have been no talks in the proposed budget for FY2022-23 over our long-standing demands for the development of the insurance sector," Sheikh Kabir Hossain said.

"We had urged the removal of 15 per cent VAT on reinsurance premium commissions, the removal of 5 per cent gain tax on life insurance customers' profits, and the imposition of a corporate tax rate of 35 per cent in non-life insurance and 30 per cent in life insurance," he said.

"We again urge the government to take our demands into account in the revised budget," he added.