US firm Milliman wants to provide consultation and advisory services to the Bangladesh’s growing insurance industry
Seattle-based actuarial and consulting firm Milliman wants to provide consultation and advisory services to the Bangladesh's growing insurance industry.
A group of the US firm's regional representatives expressed their keen interest at a programme on Tuesday in Dhaka.
Heerak Basu, a consulting actuary and partner at the Milliman Advisors LLP, told The Business Standard that Bangladesh's highly potential insurance industry demands advisory and consultancy services from actuaries.
Following a meeting with representatives from top Bangladeshi insurance companies, Basu and his team told reporters that insurance business differs from all other businesses mainly because of its nature in assessment of risks.
And that is an actuarial task, they said.
An insurance actuary is a professional who analyses statistics and uses them to calculate insurance risks and premiums. Most actuaries work to help insurance companies determine good risks or those the companies are less likely to have to pay out claims to as the result of a loss.
Bangladesh's insurance industry is seriously suffering due to a lack of actuarial professionals, both at senior and junior levels, during in-house tasks and mandatory actuarial valuation.
At present, only four Bangladeshis have the qualification of an actuary or associate actuary. Of them, only one associate actuary provides all the mandatory actuarial valuation services to the industry.
In India, any life insurance company has at least 10 actuarial staff of its own. Meanwhile, large companies have got an actuarial team comprising 40-50 professionals, said Basu, who qualified as an actuary from the United Kingdom.
Sultan-Ul-Abedine Molla, an insurance veteran and also a former member at the Insurance Development and Regulatory Authority, told The Business Standard that Bangladesh's insurance industry needs more actuarial professionals to improve own businesses and of course for better actuarial valuation reports.
"Many life insurance companies here fail to submit final reports in time, only because their actuarial valuation reports are not done by a stipulated time. The situation must come to an end," he added.
Molla, welcoming the Milliman's visiting team, said, "We see professional accountants playing a significant role in companies' management activities. In case of insurers, actuarial skill is the specialisation we need."
"Some foreign investment groups in recent years have asked us about the insurance industry here [in Bangladesh], because of its economic growth and industrial potentials, although Bangladesh is a very underpenetrated insurance market," said Sanket Kawatkar, the principal and consulting actuary of the Milliman.
Founded in 1947, Milliman has been serving markets in 59 countries from regional offices at over 20 countries.
In Asia and the Pacific region, India, Singapore, Hong Kong, China, Japan, Korea, Thailand, Indonesia, Malaysia are the most significant markets for the firm.