‘Insurance sector needs to attract more young talents’

An associate of the Chartered Insurance Institute, UK and Chartered Insurer, Adeeba Rahman currently serves as the Chairman of the Executive Committee and a Director of the Board of the Delta Life Insurance Company Limited. She also has experience working at two international banks, and two life insurance companies at different levels, and has also gathered experience from a renowned securities company and a tea company. On the occasion of National Insurance Day, Adeeba sat with The Business Post’s Niaz Mahmud and talked about various aspects of the sector.

How do you evaluate the present life insurance sector scenario in Bangladesh?

With fast-paced economic growth, Bangladesh represents an enormous opportunity for financial products like life insurance. Increasing per capita income, higher life expectancy and a large portion of the young working population make it an interesting and attractive market for life insurance products.

With the current penetration level at less than 1 per cent of GDP, and economic growth poised to be in the 8 per cent annual category, serious thinking is needed on enabling newer distribution channels, incentivising agents for a long-term career, product innovation and revisiting the existing set of regulations to suit the current trend in the financial markets across Southeast Asia.

Financially strong insurers with long-term visibility need to take the lead and with the help of the regulatory bodies, these insurers can make a difference to the overall landscape of the life insurance market. Almost 90 per cent of the business contribution in terms of gross premium is from the top 10 players, leaving the other 22 players to contribute only 10 per cent. A coordinated effort with objectivity can help increase the penetration level by 1.5-2 per cent in the next couple of years.

What needs to be done in this situation?

The industry needs to attract young talents from the market who will be able to build a career in insurance because the country’s youth today is equipped with modern technology and has an orientation to experiment with new things to bring fast-paced results.

Building consumer trust and confidence — through concentrated education and awareness programmes by the industry, regulators and the government — shall be the first step towards higher penetration. Insurance companies have to create a professional environment and run the companies professionally to attract talent and professionals.

Delta Life Insurance pioneered the concept of microinsurance in Bangladesh about 36 years ago. How has it transformed over the years?

In 1988, Delta LIFE INSURANCE launched microinsurance with the primary objective of reaching every household through a network of trained and dedicated agency forces and helping them understand the need for family protection and small savings.

Starting from Tk 10 every week from a household in those days, our agents still visit every household once a week to collect a premium as low as Tk 100 and help them create a corpus for 10 or 15 years. “Gono Grameen Bima”, as our micro insurance is popularly referred to, contributes approximately 37 per cent of our total gross premium, whereas, for the industry, it is approximately 16 per cent. Delta Life currently has a market share of 20 per cent in the microinsurance segment.

How do you see digital applications changing the business landscape in the coming years? How will the consumers benefit from it?

The life insurance industry can immensely benefit from digital applications in terms of risk assessment, reduction of moral hazard, and prompt settlement of claims, and it can enable all stakeholders to be in control of the business at all times. Delta Life has already stepped into the digital space through a user-friendly app named “Delta Life Smart Advisor”.

We are in the process of launching new tools, which will help our field-level force render services efficiently and also empower customers to know about their policy details and service requests at the click of a button.

Delta Life has been providing employee benefit insurance to large corporate entities. What has your experience been regarding this segment?

We have been serving more than 500 corporate clients, including large state-owned organisations, private sector and multinational companies. Two products that are popular in the employee benefit segment are group term life insurance and group health insurance for self, spouse and family. Our experience has been encouraging, and we are developing newer segments and product options to facilitate employers to provide more flexibility to the employees. Currently, we have more than 12 per cent market share in this segment.

What is the future plan of Delta Life Insurance?

We are continuously taking initiatives to introduce technology for ease of processing and new and innovative methods of premium collection, including mobile financial services.

Delta Life has been keeping track of the development in the insurance market across the subcontinent and other similar markets. We have been investing in technology for almost a decade, and have gradually ramped up activities in other areas as well, which require orientation towards efficient and prompt customer service.