'Micro insurance schemes necessary to tackle climate change risks'

Prime Minister Sheikh Hasina has said introduction of micro insurance schemes is necessary to tackle the risks of climate change as it will benefit the people of lower income group affected by natural calamities.

She also requested the owners of the insurance companies to give importance on social responsibility alongside making profit.

"It’s urgently needed that the insurance industry is used for the welfare of humankind," she said while inaugurating the three-day 15th International Conference on Inclusive Insurance 'Coping with Climate Risk' at Pan Pacific Sonargaon Hotel in Dhaka on Tuesday afternoon, report BSS and UNB.

The premier said a directive has been issued to bring transparency in transactions in the insurance industry.

“All transactions above Tk 10 thousand must be through a bank. All insurance companies have been instructed to show their updated insurance claims on their own website,” she said.

Sheikh Hasina said being the largest Delta in the world, Bangladesh is one of the most vulnerable nations to climate change. Cyclone, storm, floods, droughts, rain, earthquake etc. occur here round the year in different times, she said.

“Insurance can play an effective role in tackling the natural disasters. But application of insurance is very limited and inadequate in covering the risks resulting from natural disaster,” she said.

As a result, the premier said, it is possible to compensate losses and damages grossly but it is still impossible reaching the micro-level people.

Sheikh Hasina described inadequacy of information as a major problem for insurance customers.

She said consumers’ confidence in the insurance industry decreases and sometimes they are deceived too, as they remain in the dark about how many installments have been deposited and whether the installment money has actually been credited to the head office.

“To overcome the problem, the process of Unified Messaging Platform (UMP) is underway,” she said.

Sheikh Hasina urged the insurance companies to utilise their industry for humanitarian welfare and play a more effective role in keeping production and economy out of risk.

Bangladesh Insurance Association (BIA) has arranged the three-day conference in association with Munich Re Foundation and Microinsurance Network (MiN) with the theme ‘Coping With Climate Risk’.

Finance Minister AHM Mustafa Kamal, Senior Secretary of the Financial Institutions Division under the Ministry of Finance Ashadul Islam and Chairman of Bangladesh Insurance Development Authority Shafiqul Rahman Patwary were present as the special guests at the function.

Chairman of Munich Re Foundation Thomas Loster and Chairman of Microinsurance Network (MiN) Doubell Chamberlain also spoke on the occasion as special guests.

BIA President Sheikh Kabir Hossain presided over the function, while its First Vice-President Prof Rubina Hamid delivered the welcome address.

At the outset of the event, an audio-video presentation on business and insurance in Bangladesh was made.

Nearly 400 representatives of insurance and financial institutions from 42 countries are participating in the conference, organisers said.