Under Bangladesh’s legal framework, disputes are governed by the Insurance Act, 2010, and can be resolved through the Insurance Development and Regulatory Authority (IDRA). Generally the types of cases involving insurance are:

• Breach of Contract: The policyholder failed to comply with a material condition of the policy, such as failing to provide timely notification of the loss.
• Misrepresentation or Non-Disclosure: The insurer alleges that the policyholder did not disclose a material fact at the time of purchasing the policy (e.g., providing false information about a vehicle’s condition or a pre-existing medical condition).
• Dispute over Quantum of Loss: The insurer and the policyholder cannot agree on the monetary value of the loss, often requiring an independent assessment.
• Fraudulent Claims: The insurer suspects that the claim is based on fraud or intentional misrepresentation.

A “non-contentious” claim is a valid claim that is settled promptly and amicably without a formal dispute. These claims are straightforward because all policy and legal conditions have been met. Some of these claims can include:

• Valid Policy: The claim is made under an active and paid-up insurance policy.
• Proof of Loss: The policyholder provides clear evidence that a loss has occurred due to a peril covered by the policy.
• Compliance with Procedures: The insured has followed all required steps, including immediately notifying the insurer and submitting all necessary documentation (e.g., police report, fire brigade report, etc.).
• Insurable Interest: The policyholder has a genuine financial interest in the property or subject matter of the insurance.

Current laws on general insurance mandate that a certain percentage of reinsurance business must be placed with Sadharan Bima Corporation. This is a key aspect of the reinsurance regulatory environment in Bangladesh. The process is governed by the reinsurance contract, which can be either facultative (for a specific, large risk) or treaty (for a portfolio of risks). The law, particularly the Insurance Corporations Act, 2019, mandates that private non-life insurers in Bangladesh must cede a minimum percentage of their reinsurance business to the state-owned Sadharan Bima Corporation (SBC). The types of reinsurance claims depend on the nature of the reinsurance contract, which can be either:

• Facultative Reinsurance: This is a transaction-specific arrangement where the ceding company negotiates a separate reinsurance contract for a single, individual risk. This is often used for large or unusual risks that are not covered by a treaty.
• Treaty Reinsurance: This is an automatic agreement where the reinsurer agrees to accept a predetermined portfolio of risks from the primary insurer on an ongoing basis. This is a common method for handling a large volume of similar risks.

Regulatory Oversight: The IDRA has the authority to regulate all reinsurance activities in Bangladesh, including those conducted by the SBC and private insurers. They set rules to ensure that companies have adequate reinsurance arrangements to protect against large-scale losses and maintain solvency.

Claims for financial losses due to fire, lightning, explosion, and other perils specified in the policy, affecting buildings, machinery, or goods.

Motor insurance is an insurance policy that covers the policyholder in case of financial losses – resulting from an accident or other damages – sustained by the insured vehicle. A comprehensive motor insurance policy covers damages to third-party and third-party property along with compensating for own losses as well. Claims for damage to a vehicle, theft, or liability for injuries and property damage caused to a third party in an accident.

Claims for medical expenses, hospitalization costs, disability, or death resulting from an accident or illness.

A claim made by a primary insurance company to a reinsurer. This occurs when a loss exceeds the primary insurer’s predetermined financial limit, and they seek to recover the excess amount from the reinsurer as per their contract.