Page 16 - Insurance Times September 2019

Unlock new frontiers in Bangladesh non-life insurers agree on 15% commission
risk for P&C re/insurers As per the rule of the regulatory board, non-life insurance companies in
Bangladesh have finally agreed not to give more than
with advanced analytics: 15% commission to agents. After Bangladesh Insur-
Swiss Re report ance Association (BIA), a forum of sponsors, warned
its members of non-violation of the decision, the de-
As per a new sigma report from
Swiss Re Institute, the use of in- velopment comes. “We will not allow any company
creasingly advanced analytic capa- to go beyond 15 percent,” said Sheikh Kabir Hossain, president of the BIA.
bilities is enabling property and ca- The IRDA, Bangladesh Bank and all insurers have agreed to work together to
sualty (P&C) re/insurers to “unlock implement the commission rate set by the regulator in 2012. The decision must
new frontiers in risk assessment and be followed for the sake of the industry, said Mahbubur Rahman, chairman of
mitigation”. Eastland Insurance and president of the International Chamber of Commerce-
The study explored how insurance Bangladesh. Some of the companies offer up to 60% of the premium as com-
and reinsurance companies can use mission to get business, which is impacting the industry adversely, according
analytics to support growth through to the industry experts. In response to that, the IDRA issued a notice seven
new market opportunities and risk years ago asking insurers to follow its order on agent’s commission.
pools, as well as better customer When compliant insurers had tried to abide by the IDRA rule, errant compa-
comprehension. nies grabbed the business by giving exorbitant commission. The financial health
Swiss Re also underlined how ad- of many insurance companies is wobbly due to the payment of high commis-
vanced analytics can provide insight sion, said Nasir Uddin Ahmed, executive member of the BIA. Asked how the
on risk accumulation and portfolio violators would be detected, the BIA president said all the insurers will be ex-
steering, and how they can improve tra cautious and if anyone is found to be giving more commission they will be
efficiency by automating manual easily identified.
and repetitive tasks. The report es-
timated that most re/insurers seem Chubb introduces CoverPlus for middle-market manu-
to be targeting around a 2-5% im- facturers
provement in their loss ratios, the
report estimated. US-based insurance company Chubb has recently announced the launch of
CoverPlus, a new platform that offers expanded liability-driven products for
“The ability to gain useful predictive middle-market manufacturers. Chubb said that CoverPlus has been specially
insights from ever-increasing designed to fill the potential gaps in traditional insurance programs. Thus, it
amounts of data is challenging. features a suite of coordinated insurance products. The platform offers en-
There needs to be more investment hancements to address exposures including scalable pollution liability, prod-
of time and resources on data uct-withdrawal expense, errors and omissions liability, and cyber liability.
curation,” said Daniel Ryan, Head of
Insurance Risk Research at Swiss Re Near about 50% of manufacturers view risks emanating from advanced manu-
Institute. facturing techniques as extremely challenging, according to a study by Chubb
and Ohio State University’s National Center for the Middle Market (NCMM).
Eric Schuh, Global Head of P&C So-
lutions at Swiss Re, said, “The time 71% of manufacturers believe that their role in the supply chain has become
taken to implement P&C Solutions increasingly important and more collaborative with suppliers. Both trends sug-
projects depends on the Lines of gest that a more holistic approach to risk management is necessary, Chubb said.
Business and project objective, but “CoverPlus is a dynamic platform designed to offer a wide range of specialized
several weeks is the minimum time insurance products and services beyond traditional liability insurance to
for rapid deployments. proactively support businesses in the manufacturing sector as they face new
“Wider business integration and ex- exposures within a rapidly changing industry,” said Ernie Salas, senior vice presi-
tracting larger scale efficiencies can dent for commercial insurance at Chubb North America. He added, “Built on
take longer, P&C Analytics, part of more than 50 years of experience and bolstered by insights gleaned from our
the P&C Solutions suite, can also in- research with the NCMM, Chubb provides innovative and thoughtful insurance
tegrate other solutions into its solutions backed by our industry-leading capabilities in underwriting, claims and
projects for added client benefits.” risk engineering.”

16 The Insurance Times, September 2019