Eastern Insurance fined Tk 5 lakh

The Insurance Development and Regulatory Authority (IDRA) has fined Eastern Insurance Company Tk 5 lakh for not having the minimum investment required in government securities as per the Insurance Act 2010.

The company has Tk 12.50 crore invested in government securities but it should have had Tk 17.70 crore as per Non-Life Insurer's Asset Investment and Preservation Regulations 2019, reads an IDRA document.

The fine was imposed in March this year.

In response, the company's acting chief executive officer, Md Iqbal Mahmud, sent a letter to the IDRA on April 9 assuring to meet the shortfall by May and requesting IDRA Chairman Mohammad Jainul Bari to waive the fine.

When contacted by The Daily Star yesterday, Mahmud did not comment on the reason behind the shortfall.

However, he informed that they were yet to receive a response in writing from the IDRA.

In turn, an IDRA official, on condition of anonymity, said the regulatory body had retained the fine on holding a hearing.

Eastern Insurance Company is one of the pioneers in general insurance business operating in the private sector of Bangladesh. The company website said it started operations in 1986.

Listed with Dhaka Stock Exchange and Chittagong Stock Exchange in 1994 and 1996 respectively, the company has an authorised capital of Tk 100 crore and paid-up capital of Tk 43.11 crore.

There are currently 36 life insurance and 46 non-life insurance companies in Bangladesh.