All insurance cos must open actuarial dept

The Insurance Development and Regulatory Authority (IDRA) have instructed all life insurance companies operating in the country to open an independent Actuarial Department to conduct business transparently for the sake of insurers. 

The regulatory body sent a circular to the chief executive officers (CEO) of all life insurance companies in the country in this regard on Wednesday.

According to the circular, signed by IDRA Chairman Mohammad Zainul Bari, students or employees with knowledge in actuarial works and degrees in actuarial sciences including maths and statistics should be appointed at the actuarial departments.

“Realising the need of the actuaries, IDRA issued the directive asking all the life insurance companies to open a separate actuarial department,” IDRA Executive Director SM Shakil Akhtar told The Business Post. 

“IDRA will take necessary action if any companies do not follow the instruction,” he said, adding that many companies have already set up actuarial departments and started working.

According to the circular, the necessary information regarding the actuarial department should be provided to IDRA by June and December every year.

It also said the actuarial departments shall consist of at least two regular officers. But insurance companies with life funds over Tk 500 crore should have at least three officers in the department.

Regarding the regulatory instructions, Sadharan Bima Corporation director AKM Ehsanul Haque said IDRA earlier also issued a circular to open actuarial departments in insurance companies but only a few companies complied with that directive.

He said it is unfortunate that insurance companies are not making proper use of the country’s Masters of Actuarial Science (MAS) degree holders. Many of the actuary degree holders are being assigned to other departments instead of being assigned to the respective department of the company.