The Insurance Act, 1938

An Act to consolidate and amend the law relating to the business of insurance. WHEREAS it is expedient to consolidate and amend the law relating to the business of insurance; It is hereby enacted as follows:-

Section 1. Short title, extent and commencement

(1) This Act may be called the Insurance Act, 1938.

(2) It extends to the whole of Bangladesh.

(3) It shall come into force on such date as the Government may, by notification in the official Gazette, appoint in this behalf.

Section 2. Definitions

In this Act, unless there is anything repugnant in the subject or context,-

(1) “actuary” means an actuary is possessing such qualifications as may be prescribed;

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²(3) “approved securities” means Government securities, and any other security charged on the revenues of the Government, or guaranteed fully as regards principal and interest by the Government; and any debenture or other security for money issued under the authority of any Act of Parliament and specified as an approved security for the purposes of this Act by the Government by notification in the official Gazette;

³(3A) “approved investments” means such investments as the Government may, by notification in the official Gazette, specify as approved investments for the purposes of this Act;

(4) “auditor” means a person qualified under the provisions of section 144 of the Companies Act, 1913, to act as an auditor of companies;

(5) “certified” in relation to any copy or translation of a document required to be furnished by or on behalf of an insurer or a provident society as defined in Part III means certified by a principal officer of such insurer or provident society to be a true copy or a correct translation, as the case may be;

⁴(5A) “company” has the meaning assigned to it in clause (2) of section 2 of the Companies Act, 1913;

(5B) “Chief Controller of Insurance” or “Chief Controller” means the officer appointed by the Government to perform the duties of the Chief Controller of Insurance under this Act;

(6) “Court” means the principal Civil Court of original jurisdiction in a district, and includes the High Court Division in exercise of its ordinary original civil jurisdiction;

⁵(6A) “employer of agents” means a person certified under section 42A who procures insurance business for an insurer whether wholly or in part by employing or causing to be employed insurance agents on behalf of the insurer;

(6B) “fire insurance business” means the business of effecting, otherwise than incidentally to some other class of insurance business, contracts of insurance against loss by or incidental to fire or other occurrence customarily included among the risks insured against in fire insurance policies;

(6C) “general insurance business” means fire, marine or miscellaneous insurance business, whether carried on singly or in combination with one or more of them;

(7) “Government securities” means Government securities as defined in the Securities Act, 1920;

⁶(7A) “health insurance business” means the business of effecting contract of insurance upon human sickness or accidental human body injury necessitating medical treatment by a medical practitioner registered under Medical and Dental Council Act, 1980 (XVI of 1980);

(8) “insurance company” means any insurer being a company, association or partnership which may be wound up under the Companies Act, 1913, or to which the Partnership Act, 1932, applies;

⁷(8A) “insurance surveyor” means a person (certified under section 44A) who examines the goods, property or any interests insured under a policy of general insurance to

ascertain the cause, extent and location of any loss and to determine the amount of such loss and the amount which is payable to the insured by the insurer or insurers or any person liable in respect of such loss;

(9) “insurer” means-

but does not include an insurance agent licensed under section 42 or a provident society as defined in Part III;

(10) “insurance agent” means a person who has been granted a licence under section 42 to act as an insurance agent;

(11) “life insurance business” means the business of effecting contracts of insurance upon human life, including any contract whereby the payment of money is assured on death (except policies for death by accident only) or the happening of any contingency dependent on human life or which is subject to payment of premiums for a term dependent on human life and shall be deemed to include-

⁹(d) health insurance;

(12) “manager” and “officer” have the meanings assigned to those expressions in clauses (9) and (11) respectively of section 2 of the Companies Act, 1913;

(13) “managing agent” means a person, firm or company entitled to the management of the whole affairs of a company by virtue of an agreement with the company, and under the control and direction of the directors except to the extent, if any, otherwise provided for in the agreement, and includes any person, firm or company occupying such position by whatever name called.

Explanation.- If a person occupying the position of managing agent calls himself manager or managing director, he shall nevertheless be regarded as managing agent for the purposes of section 32 of this Act;

¹⁰(13A) “marine insurance business” means the business of effecting contracts of insurance upon vessels of any description, including cargoes, freights and other interests which may be legally insured, in or in relation to such vessels, cargoes and freights, goods, wares, merchandise and property of whatever description insured for any transit by land, water or air, or by any combination thereof and whether or not including warehouse risks or similar risks in addition or as incidental to such transit, and includes any other risks customarily included among the risks insured against in marine insurance policies;

¹¹(13AA) “member of the family”, in relation to any person, means the husband or a wife, the dependent father, mother, brother or sister, or a minor son or unmarried daughter of that person;

(13B) “miscellaneous insurance business” means the business of effecting contracts of insurance which is not principally of any kind included in clauses ¹²clause (6B), excluding sub-clause (d) of clause (11) and clause (13A);

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¹⁴(13D) “policy-holder” includes a person to whom the whole of the interest of the policy-holder in the policy is assigned once and for all, but does not include an assignee thereof whose interest in the policy is defeasible or is for the time being subject to any condition;

(14) “prescribed” means prescribed by rules made under section 114;

¹⁵(14A) “private company” has the meaning assigned to it in clause (13) of section 2 of the Companies Act, 1913;

(14B) “public company” means a company incorporated under the Companies Act, 1913 or under the Indian Companies Act, 1882, or under the Indian Companies Act, 1866, or under any Act repealed thereby, which is not a private company or a subsidiary of a private company;

¹⁶(15) “scheduled bank” has the same meaning as assigned to it in clause (k) of Article 2 of the Bangladesh Bank Order, 1972;

(16) “specified miscellaneous insurance business” means such classes or sub-classes of miscellaneous insurance business as may be prescribed for the purposes of section 3AA or section 6.

Insurers to be subject to this Act while liabilities remain unsatisfied

¹⁷2A. Every insurer shall be subject to all the provisions of this Act in relation to any class of insurance business so long as his liabilities in Bangladesh in respect of business of that class remain unsatisfied or not otherwise provided for.

Section 2B. 2B. This Act not to apply to certain insurers ceasing to enter into new contracts before commencement of Act

The provisions of this Act shall not apply to an insurer as defined in paragraph (i) or (iii) of sub-clause (a) of clause (9) of section 2 in relation to any class of his insurance business where such insurer has ceased, before the commencement of this Act, to enter into any new contracts of that class of business.]

Prohibition of transaction of insurance business by certain persons

¹⁸2C. (1) No person other than-

shall start any insurance business in Bangladesh and a person, other than a person specified in clause (a), (b) or (c), who, immediately before the commencement of the Insurance (Amendment) Ordinance, 1958, was carrying on such business in Bangladesh shall, after the expiry of one year from such commencement, discontinue such business.

(2) No Mutual Insurance Company which was not registered, before the commencement of the Insurance (Amendment) Ordinance, 1958, for any class of insurance business, shall be registered for any class of general insurance business and no Mutual Insurance Company which was registered, before such commencement, for any class of insurance business, shall, be registered for any additional class of insurance business unless such company satisfies such conditions as may be prescribed.

Explanation.- In this section, ÔÇÿMutual Insurance Company' has the meaning assigned to it in Part IV of this Act and includes any company constituted or incorporated outside Bangladesh which is of the nature of a Mutual Insurance Company.

Section 3. Registration

(1) No person shall, after the commencement of this Act, begin to carry on any class of insurance business in Bangladesh, and no insurer carrying on any class of insurance business in Bangladesh shall, after the expiry of three months from the commencement of this Act, continue to carry on any such business, unless he has obtained from the Chief Controller of Insurance a certificate of registration for the particular class of insurance business:

Provided that in the case of an insurer who was carrying on any class of insurance business in Bangladesh at the commencement of this Act, failure to obtain a certificate of registration in accordance with the requirements of this sub-section shall not operate to invalidate any contract of insurance entered into by him if before such date as may be fixed in this behalf by the Government by notification in the official Gazette, he has obtained that certificate.

²⁰(1A) Notwithstanding anything contained in this Act, no certificate of registration shall be granted by the Chief Controller of Insurance to any person ²¹* * * for carrying on any class of insurance business in Bangladesh without the prior permission of the Government.

(2) Every application for registration shall be accompanied by-

Provided that in the case of marine, accident and miscellaneous insurance business other than workmen's compensation and motor car insurance the Chief Controller of Insurance may exempt any insurer from the above requirements regarding prospectus, forms and statements to such extent and for such period as he may deem fit; and

(3) In the case of any insurer having his principal place of business or domicile outside Bangladesh, the Chief Controller of Insurance shall withhold registration or shall cancel a registration already made, if he is satisfied that in the country in which such insurer has his principle place of business or domicile Bangladesh nationals are debarred by the law or practice of the country relating to, or applied to insurance from carrying on the business of insurance, or that any requirement imposed on such insurer under the provisions of section 62 is not satisfied.

(4) The Chief Controller of Insurance shall cancel the registration of an insurer either wholly or in so far as it relates to a particular class of insurance business, as the case may be,-

and the Chief Controller of Insurance may cancel the registration of an insurer-

(5) When the Chief Controller of Insurance withholds or cancels any registration under sub-section (3) or clause (a), clause (e), clause (f) or clause (g) of sub-section (4), he shall give notice in writing to the insurer of his decision, and the decision shall take effect on such date as he may specify in that behalf in the notice, such date not being less than one month nor more than two months from the date of the receipt of the notice in the ordinary course of transmission.

²³(5A) When the Chief Controller of Insurance cancels any registration under clause (b), clause (c) or clause (d) of sub-section (4) the cancellation shall take effect on the date on which notice of the order of cancellation is served on the insurer.

(5B) When a registration is cancelled the insurer shall not, after the cancellation has taken effect, enter into any new contracts of insurance, but all rights and liabilities in respect of contracts of insurance entered into by him before such cancellation takes effect shall, subject to the provisions of sub-section (5D), continue as if the cancellation had not taken place.

(5C) Where a registration is cancelled under clause (a), clause (e), clause (f), or clause (g) of sub-section (4), the Chief Controller of Insurance may at his discretion revive the

registration, if the insurer makes the deposits required by section 7 or section 98, or has his standing contract restored or has had an application under sub-section (4) of section 3A accepted, or satisfies the Chief Controller of Insurance that no claim upon him such as is referred to in clause (g) of sub-section (4) remains unpaid or that he has complied with the requirement for the non-compliance or contravention of which the registration was cancelled under clause (f) of sub-section (4), as the case may be, and complies with any directions which may be given to him by the Chief Controller of Insurance.

(5D) Where the registration of an insurance company is cancelled under sub-section (4), the Chief Controller of Insurance may, after the expiry of six months from the date on which the cancellation took effect, apply to the Court for an order to wind up the insurance company, or to wind up the affairs of the company in respect of a class of insurance business, unless the registration of the insurance company has been revived under sub-section (5C) or an application for winding up the company has been already presented to the Court. The Court may proceed as if an application under this sub-section were an application under sub-section (2) of section 53, or sub-section (1) of section 58, as the case may be.

(6) Subject to compliance with the provisions of sections 2C, 5, sub-section (2A) of section 10 and section 32 and of any order made under section 3B, the Chief Controller of Insurance shall, on being satisfied that the applicant has fulfilled all the requirements of this section applicable to him, register the insurer and grant him a certificate of registration.

(7) The Chief Controller of Insurance may, on payment of the prescribed fee which shall not exceed ²⁴five hundred Taka, issue a duplicate certificate of registration to replace a certificate lost, destroyed or mutilated, or in any other case where he is of opinion that the issue of a duplicate certificate is necessary.

Determination of premium rates for general insurance business

²⁵3BBB. The Chief Controller of Insurance shall, at intervals of not less than one year, determine, in consultation with the insurers carrying on general insurance business, the rates of premium for such insurance business.

Section 3F. Restriction on issue of certain policies at new rates, etc.

No insurer shall offer any policy or contract in respect of life insurance business other than those described in the prospectus filed with the Chief Controller of Insurance under clause (f) of sub-section (2) of section 3 or any amendment to such prospectus filed with the Chief Controller of Insurance under section 26 under he files with the Chief Controller the rates, advantages and terms and conditions of such policy or contract.]

Renewal of Registration

²⁶3A. (1) An insurer who has been granted a certificate of registration under section 3 shall have the registration renewed annually for each year.

(2) An application for the renewal of a registration for any year shall be made by the insurer to the Chief Controller of Insurance before the 31st day of December of the preceding year, and shall be accompanied as provided in sub-section (3) by evidence of payment of a fee of ²⁷three Taka and fifty poisha per thousand of gross direct premium written in Bangladesh during the year preceding the year ending on the said date.

(2A) and (2B) [Omitted by section 3 of the Insurance (Amendment) Ordinance 1984 (Ordinance No. L of 1984.

(3) The prescribed fee for the renewal of a registration for any year shall be paid into the Bangladesh Bank or, where there is no office of that Bank, into the ²⁸Sonali Bank acting as the agent of that Bank, or into any Government treasury, and the receipt shall be sent along with the application for renewal of the registration.

(4) If an insurer fails to apply for renewal of registration before the date specified in sub-section (2) the Chief Controller of Insurance may, so long as an application to the Court under sub-section (5D) of section 3 has not been made, accept an application for renewal of the registration on receipt from the insurer of the fee payable with the application and such penalty, not exceeding the prescribed fee payable by him as the Chief Controller of Insurance may require:

Provided that an appeal shall lie to the Government from an order passed by the Chief Controller of Insurance imposing a penalty on the insurer.

(5) The Chief Controller of Insurance shall, on fulfilment by the insurer of the requirements of this section, renew the registration and grant him a certificate of renewal of registration.]

Insurers not to transact both life and general insurance business

²⁹3AA. (1) After the commencement of the Insurance (Amendment) Ordinance, 1970, no person shall be registered as an insurer-

(2) No insurer registered before the commencement of the Insurance (Amendment) Ordinance, 1970, for life insurance business and also for any class of general insurance business shall, after the expiry of five years from such commencement, transact both types of business:

Provided that the Government may, on the application of an insurer, from time to time extend the said period of five years by such further period, not exceeding two years in the aggregate, as it may deem fit.

(3) An insurer who, immediately before the commencement of the Insurance (Amendment) Ordinance, 1970, was transacting both life insurance business and general insurance business shall, as soon as practicable, submit for the sanction of the Chief Controller of Insurance a scheme for the separation, transfer or winding up of either type of its business.

(4) The Chief Controller of Insurance shall, upon receipt of a scheme under sub-section (3), refer it for approval to the Government suggesting such modifications therein as he may consider necessary for protecting the interests of the policy-holders and shall,-

(5) Where a scheme of an insurer is sanctioned under sub-section (4), with or without modification, the insurer shall separate, transfer or wind up his business according to the scheme as sanctioned.

(6) Where any scheme sanctioned under sub-section (4) involves the establishment of a new insurance company, the Government shall give its consent under the Capital Issues (Continuance of Control) Act, 1947 (XXIX of 1947), to the issue of such capital as may be necessary for the establishment of such company.

(7) No insurer transacting life insurance business shall, after the expiry of five years from the commencement of the Insurance (Amendment) Ordinance, 1970 or of the period by which the said period of five years is extended under the proviso to sub-section (2), employ in any capacity any officer employed by an insurer transaction general insurance business.

Explanation.- In this sub-section, “officer” means any person, whosoever designated, who is responsible for the conduct of any business, or the management of any of the affairs, of the insurer.

Rates, terms and conditions of operation of an insurer

³⁰3B. If, when considering an application for registration under section 3 or at any other time, it appears to the Chief Controller of Insurance that the rates, advantages, terms and conditions offered or to be offered in connection with, or any

class, condition or warranty in, any proposal, policy or other forms of any class or sub-class of insurance business are in any respect not workable or sound or are in any respect unrealistic or un-reasonable in relation to the general experience of the business of that class or sub-class in Bangladesh or any provision in the memorandum and Articles of Association or the instrument constituting or defining the constitution of the insurer is objectionable or that the reinsurance arrangements of the insurer are not adequate, he may, by order in writing and after giving the insurer an opportunity of being heard, issue such directions to the insurer or require the insurer to make within such time as may be specified in the order such modifications, additions, or omissions in the said rates, advantages, terms, conditions, clauses, warranties, memorandum and articles of association, instrument or reinsurance arrangements as he may think necessary:

Provided that no directions under this section shall be issued without the prior approval of the Government to an insurer already registered under this Act.

Basis for determination of premium rates

³¹3BB. (1) The Chief Controller of Insurance shall, at intervals of not less than five years,-

(2) The Chief Controller of Insurance may direct an insurer to furnish such information as the Chief Controller may require for the purpose of preparing the mortality table and the statement of yield and laying down the level of expenses under sub-section (1); and every insurer shall comply with such direction.

(3) The mortality table, the statement of yield and the level of expenses prepared and laid down under sub-section (1) shall be published in the official Gazette.

(4) Every insurer shall, on the basis of the current mortality table, the statement of yield and the level of expenses published under sub-section (3),-

Provisions relating to collection of premiums

³²3C. (1) Every insurer shall declare to the Chief Controller of Insurance the total amount of premiums including agents' balances in respect of fire, marine and miscellaneous insurance business outstanding on the first day of February, 1958, and shall recover the same within such time as may be allowed and comply with such directions as may be given, by the Chief Controller.

(2) Every insurance agent and every employer of agents shall, within such time as may be allowed to him by the Chief Controller of Insurance, pay to the insurer for whom he has been acting as an insurance agent or employer of agents, all amounts due to the insurer on account of the premiums in respect of general insurance business received by him on behalf of the insurer and outstanding against him as on the first day of February, 1958.

(3) No insurer shall write off any premium in respect of general insurance business which was outstanding on the first day of February, 1958, without the prior approval of the Chief Controller of Insurance.

(4) No insurer shall assume in Bangladesh any risk in respect of general insurance business unless and until the premium payable or such part thereof as may be prescribed, has been received by him or has been guaranteed to be paid by such person in such manner and within such time as may be prescribed.

(5) Any refund of premium which may become due to the insured on account of the cancellation of a policy of general insurance or alteration in its terms and conditions shall be paid directly to the insured by a crossed or order cheque or by money-order and a proper receipt shall be obtained from the insured, and such refund shall in no case be credited to the account of the agent.

Licensing of branch offices of insurers

³³3E. (1) No insurer shall, after the expiry of six months from the commencement of the Insurance (Amendment) Ordinance, 1970, transact any business at any of his branches or offices, other than the head office, unless he has obtained a licence from the Chief Controller of Insurance for each such branch or office; and the Chief Controller of Insurance shall, upon an application made in this behalf and payment of the prescribed fee, grant such licence.

(2) No insurer shall, after the commencement of the Insurance (Amendment) Ordinance, 1970, open a new branch or office unless he has obtained a licence for such branch or office from the Chief Controller of Insurance.

(3) Application for a licence under sub-section (1) or sub-section (2) shall be made in the prescribed form and shall be accompanied by a prescribed fee which shall not be more than ³⁴twenty-thousand Taka.

(4) The Chief Controller of Insurance may, for reasons to be recorded in writing, refuse a licence under sub-section (2) to open a new branch or office and, if he so refuses, shall

communicate his decision in writing to the applicant within six weeks from the date of the application.

(5) An insurer to whom a licence to open a new branch or office has been refused by the Chief Controller may prefer an appeal against the refusal to the Government whose decision on such appeal shall be final.

(6) Where a licence to open a new branch or office has been refused, no fresh application for a licence to open such branch or office shall be entertained within a period of one year from such refusal.

Section 3D. Provisions relating to reinsurances and insurances abroad

(1) No insurer shall reinsure outside Bangladesh any insurance business or any part thereof underwritten by him in Bangladesh which is in excess of its treaty reinsurance arrangement unless a certificate has been obtained from the Chief Controller to the effect that such excess cannot be placed within Bangladesh.

³⁵* * *

Explanation I.- For the purposes of this sub-section a reinsurance arrangement shall not be deemed to be a treaty reinsurance arrangement if such arrangement operates in a casual manner and in determining whether a particular reinsurance arrangement is a treaty reinsurance arrangement or not, the decision of the Chief Controller of Insurance shall be final.

Explanation II.- For the purposes of this sub-section a reinsurance arrangement in respect of life insurance business entered into by an insurer domiciled elsewhere than in Bangladesh with his head office shall be deemed to be treaty reinsurance arrangement to the extent determined by the Chief Controller of Insurance.

(2) No person shall insure outside Bangladesh any risk or any part thereof in respect of any property or interests in Bangladesh unless a certificate has been obtained from the Chief Controller to the effect that the risk in question cannot be insured in Bangladesh:

Provided that the Chief Controller may grant an exemption to any person from the requirements of this sub-section in respect of such property or interests and for such period as he may deem fit.

(3) The Chief Controller shall, if he refuses a certificate under sub-section (1) or sub-section (2), communicate his decision in writing to the applicant for the certificate, within one month from the date of the application.

(4) Every insurer shall submit, in the prescribed manner, to the Chief Controller of Insurance before the expiry of six months from the commencement of the Insurance (Amendment) Ordinance, 1970, a certified statement giving salient features of his reinsurance arrangement in respect of his business in Bangladesh and such other information about the reinsurance treaty as may be required by the Chief Controller.

(5) Where any reinsurance treaty the particulars of which have been submitted to the Chief Controller of Insurance under sub-section (4) is altered or any new reinsurance arrangement is made after the submission of the information under sub-section (4), the insurer concerned shall submit to the Chief Controller, in the prescribed manner, a report giving the particulars or such alteration in the treaty of such reinsurance arrangement within one month of such alteration or arrangement and shall submit such further information or clarification as the Chief Controller may require.

(6) The Chief Controller of Insurance may, after examining the statement submitted under sub-section (4) and the report, if any, submitted under sub-section (5), and giving the insurer an opportunity of being heard, for reasons to be recorded in writing, direct the insurer to make such modifications in his reinsurance treaty or reinsurance arrangement as the Chief Controller may specify.

(7) Notwithstanding anything contained in any other law for the time being in force, the Government may require insurers to reinsure within Bangladesh with reinsurers approved for this purpose, or among themselves, such proportion of the insurance business or such proportion of the reinsurance treaties as may be prescribed.]

Section 4. [Omitted.]

[Minimum limits for annuities and other benefits secured by policies of life insurance.- Omitted by section 8 of the Insurance (Amendment) Act, 1958 (Act No. XXVII of 1958).]

Section 5. Restriction on name of insurer

(1) An insurer shall not be registered by a name identical with that by which an insurer in existence is already registered, or so nearly resembling that name as to be calculated to deceive except when the insurer in existing is in the course of being dissolved and signifies his consent to the Chief Controller of Insurance.

(2) If any insurer, through inadvertence or otherwise, is without such consent as aforesaid registered by a name identical with that by which an insurer already in existence whether previously registered or not is carrying on business or so nearly resembling it as to be calculated to deceive, the first-mentioned insurer shall, if called upon to do so by the Chief Controller of Insurance on the application of the second-mentioned insurer, change his name within a time to be fixed by the Chief Controller of Insurance:

Provided that nothing in this section shall apply to any insurer carrying on business before the 27th day of January, 1937, under the Indian Life Insurance Companies Act, 1912:

Provided further that in the application of this section to any insurer who begins to carry on insurance business after the commencement of the Insurance (Amendment) Act, 1946, the references to an insurer in existence in sub-section (1) and this sub-section shall be construed as including references to a provident society (as defined in Part III) in existence, whether or not the society is in the course of being dissolved.

(3) No insurer other than a provident society as defined in Part III, who begins to carry on insurance business after the commencement of this Act, shall adopt as its name and so such insurer carrying on business before the commencement of this Act shall continue after the expiry of six months from the commencement thereof to use as its name any combination of words which includes the word “provident”.

Requirements as to capital and share-holdings

³⁶6. (1) No insurer, other than an insurer who was transacting any class of insurance business in Bangladesh immediately before the commencement of the Insurance (Amendment) Ordinance, 1984 (L of 1984), shall be registered after such commencement for transacting any class of insurance business unless he has a paid-up capital of not less than the amount specified in the Seventh Schedule and his shares have been subscribed in such manner as may be prescribed:

Provided that the Government may, by notification in the official Gazette, relax the provision of this section relating to the amount of paid-up capital, subject to such conditions as it deems fit to specify, for a period not exceeding three years from the date of commencement of the Insurance (Amendment) Ordinance, 1984 (L of 1984).

Section 7. Deposits

³⁷(1) Every insurer shall deposit, at the time of making application for registration, and keep deposited with the Bangladesh Bank, for and on behalf of the Government, the amount specified in the Seventh Schedule, either in cash or in approved securities estimated at the market value of the securities on the day of the deposit, or partly in cash and partly in approved securities so estimated.

(2) [Omitted by section 6 of the Insurance (Amendment) Ordinance, 1984 (Ordinance No. L of 1984).]

(3) and (4) [Omitted by section 10 of the Insurance (Amendment) Act, 1958 (Act No. XXVII of 1958).]

(5) and (6) [Omitted by section 6 of the Insurance (Amendment) Ordinance, 1984 (Ordinance No. L of 1984).]

(7) [Omitted by section 10 of the Insurance (Amendment) Act, 1958 (Act No. XXVII of 1958).]

(8) A deposit made in cash shall be held by the Bangladesh Bank to the credit of the insurer and shall except to the extent, if any, to which the cash has been invested in securities under sub-section (9A), be returnable to the insurer in cash in any case in which under the provisions of this Act a deposit is to be returned; and any interest accruing due and collected on securities deposited under sub-section (1) or sub-section (2) shall be paid to the insurer, subject only to deduction of the normal commission chargeable for the realisation of interest.

³⁸(9) The insurer may at any time replace any securities deposited by him under this section with the Bangladesh Bank either by cash or by other approved securities or partly by cash and partly by other approved securities, provided that such cash, or the value of such other approved securities estimated at the market rates prevailing at the time of replacement, or such cash together with such value, as the case may be, is not less than the value of the securities replaced estimated at the market rates prevailing when they were deposited.

(9A) The Bangladesh Bank shall, if so requested by the insurer,-

(9B) Where sub-section (9A) applies,-

(10) If any part of a deposit made under this section is used in the discharge of any liability of the insurer, the insurer shall deposit such additional sum in cash or approved securities estimated at the market value of the securities on the day of deposit, or partly in cash and partly in such securities, as will make up the amount so used. The insurer shall be deemed to have failed to comply with the requirements of sub-section (1), unless the deficiency is supplied within a period of two months from the date when the deposit or any part thereof is so used for discharge of liabilities.

Section 8. Reservation of deposits

(1) Any deposit made under section 7 or section 98 shall be deemed to be part of the assets of the insurer but shall not be susceptible of any assignment or charge; nor shall it be available for the discharge of any liability of the insurer other than liabilities arising out of policies of insurance issued by the insurer so long as any such liabilities remain undischarged; nor shall it be liable to attachment in execution of any decree except a decree obtained by a policy-holder of the insurer in respect of a debt due upon a policy which debt the policy-holder has failed to realise in any other way.

(2) Where a deposit is made in respect of life insurance business the deposit made in respect thereof shall not be available for the discharge of any liability of the insurer other than liabilities arising out of policies of life insurance issued by the insurer.

Section 9. Refund of deposits

(1) Where an insurer has ceased to carry on in Bangladesh any class of insurance business in respect of which a deposit has been made under section 7 or section 98 and his liabilities in Bangladesh in respect of business of that class have been satisfied or are otherwise provided for, the Court may, on the application of the insurer, order the return to the insurer of so much of the deposit as does not relate to the classes of insurance, if any, which he continues to carry on.

(2) [Omitted by section 3 and the Second Schedule of the Bangladesh Laws (Revision And Declaration) Act, 1973 (Act No. VIII of 1973).]

Section 10. Separation of accounts and funds

(1) Where the insurer carries on business of more than one of the classes specified in clauses (a), (b), (c) and (d) of sub-section (1) of section 7, he shall keep a separate account of all receipts and payments in respect of each such class of insurance business and where the insurer carries on business of the class specified in clause (d) of that sub-section whether alone or in conjunction with business of another class, he shall,

unless the Chief Controller of Insurance waives this requirement in writing, keep a separate account of all receipts and payments in respect of each such sub-class of the class specified in clause (d) as may be prescribed in this behalf.

(2) Where the insurer carries on the business of life insurance, all receipts due in respect of such business, shall be carried to and shall form a separate fund to be called the life insurance fund the assets of which shall be kept free from all encumbrances and distinct and separate from all other assets of the insurer and the deposit made by the insurer in respect of life insurance business shall be deemed to be a part to the assets of such fund; and every insurer shall furnish to the Chief Controller of Insurance along with the returns referred to in section 11, a statement showing in detail such assets as at the close of every calendar year duly certified by an auditor:

Provided that an insurer may show in such statement all the assets held in his life department and any deductions on account of general reserves and other liabilities of that department:

Provided further that the Chief Controller may call for a statement similarly certified of such assets as at any other date specified by him to be furnished within a period of three months from the date with reference to which the statement is called for.

³⁹(2A) No insurer carrying on life insurance business shall be entitled to be registered for any class of insurance business in addition to the class or classes for which he has been already registered unless the Chief Controller of Insurance is satisfied that the assets of the life insurance fund of the insurer are adequate to meet all his liabilities on policies of life insurance maturing for payment.

(3) The life insurance fund shall be as absolutely the security of the life policy-holders as though it belonged to an insurer carrying on no other business than life insurance business and shall not be liable for any contracts of the insurer

for which it would not have been liable had the business of the insurer been only that of life insurance and shall not be applied directly or indirectly for any purposes other than those of the life insurance business of the insurer.

Section 11. Accounts and balance-sheet

(1) Every insurer, in the case of an insurer specified in sub-clause (a) (ii) or sub-clause (b) of clause (9) of section 2 in respect of all insurance business transacted by him, and in the case of any other insurer in respect of the insurance business transacted by him in Bangladesh, shall at the expiration of each calendar year prepare with reference to that year-

(2) Unless the insurer is a company as defined in clause (2) of sub-section (1) of section 2 of the Companies Act, 1913, the accounts and statements referred to in sub-section (1) shall be signed by the insurer, or in the case of a company by the chairman, if any, and two directors and the principal officer of the company, or in the case of a firm by two partners of the firm and shall be accompanied by a statement containing the names and descriptions of the persons in charge of the management of the business during the period to which such accounts and statements refer and by a report by such persons on the affairs of the business during that period.

Section 12. Audit

The balance-sheet, profit and loss account, revenue account and profit and loss appropriation account of every insurer, in the case of an insurer specified in sub-clause (a)(ii) or sub-clause (b) of clause (9) of section 2 in respect of all insurance business transacted by him, and in the case of any other insurer in respect of the insurance business transacted by him in Bangladesh, shall, unless they are subject to audit under the Companies Act, 1913, be audited annually by an auditor, and the auditor shall in the audit of all such accounts have the powers of, exercise the functions vested in, and discharge the duties and be subject to the liabilities and penalties imposed on, auditors of companies by section 145 of the Companies Act, 1913.

Special audit

⁴⁰12A. (1) The books and records of every insurer, in the case of an insurer specified in sub-clause (a) (ii) or sub-clause (b) of clause (9) of section 2 in respect of all insurance business transacted by him, and in the case of any other insurer in respect of the insurance business transacted by him in Bangladesh, shall be audited annually by an auditor or auditors to be appointed every year by the Chief Controller of Insurance for making such investigation and submitting such reports as may be prescribed:

Provided that the auditor or any of the auditors appointed under this section for any year of account shall not be the auditor or auditors employed by the insurer for an audit under the Companies Act, 1913 or under section 12 of this Act for that year of account.

(2) An auditor appointed under this section shall have a right of access to all such books of account, registers, vouchers, correspondence and other documents of the insurer, and shall be entitled to require from the directors and officers of the insurer such information and explanation, as may be necessary for the performance of his function and duties under this section.

(3) Every report prepared by an auditor or auditors appointed under this section shall be submitted in quadruplicate to the Chief Controller who may take such action thereon in accordance with the provisions of this Act as he deems fit.

(4) An auditor appointed under this section shall be paid by the insurer such fees as may be prescribed and in prescribing such fees regard shall be had to the size of the insurer and the class or classes of business transacted by him.

(5) The fee payable by an insurer under sub-section (4) shall be paid to the auditor within such time as may be specified by the Chief Controller.

Section 13. Actuarial report and abstract

(1) Every insurer carrying on life insurance business shall, in respect of the life insurance business transacted by him in Bangladesh, and also in the case of an insurer specified in sub-clause (a) (ii) or sub-clause (b) of clause (9) of section 2 in respect of all life insurance business transacted by him, once at least in every ⁴¹two years cause an investigation to be made by an actuary into the financial condition of the life insurance business carried on by him, including a violation of his liabilities in respect thereto and shall cause an abstract of the report of such actuary to be made in accordance with the regulations contained in Part I of the Fourth Schedule and in conformity with the requirements of Part II of that Schedule.

(1A) and (1B) [Omitted by section 7 of the Insurance (Amendment) Ordinance, 1984 (Ordinance No. L of 1984).]

(2) The provisions of sub-section (1) regarding the making of an abstract shall apply whenever at any other time an investigation into the financial condition of the insurer is made with a view to the distribution of profits or an investigation is made of which the results are made public.

(3) There shall be appended to every such abstract as is referred to in sub-section (1) or sub-section (2) a certificate

signed by the principal officer of the insurer that full and accurate particulars of every policy under which there is a liability either actual or contingent have been furnished to the actuary for the purpose of the investigation.

(4) There shall be appended to every such abstract a statement, in conformity with the requirements of Part II of the Fifth Schedule and prepared in accordance with the regulations contained in Part I of that Schedule, of the life insurance business in force at the date which the accounts of the insurer are made up for the purposes of such abstract:

Provided that, if the investigation, referred to in sub-sections (1) and (2) is made annually by any insurer, the statement need not be appended every year but shall be appended at least once in every three years.

(5) Where an investigation into the financial condition of an insurer is made as at a date other than the expiration of the year of account, the accounts for the period since the expiration of the last year of account and the balance-sheet as at the date at which the investigation is made shall be prepared and audited in the manner provided by this Act.

(6) The provisions of this section relating to life insurance business shall apply also to any such sub-class of miscellaneous insurance business as may be prescribed in this behalf:

Provided that no sub-class of miscellaneous insurance business shall be prescribed under this sub-section if the insurance business comprised in the sub-class consists of insurance contracts which are terminable by the insurer at intervals not exceeding twelve months and under which if a claim arises, the insurer's liability to pay benefit ceases within one year of the date on which the claim arose:

Provided further that the Chief Controller of Insurance may authorise such modifications and variations of the regulations contained in Part I of the Fourth and Fifth Schedules and of the requirements of Part II of those Schedules as may be necessary to facilitate their application to any such sub-class of miscellaneous insurance business:

Provided also that if the Chief Controller of Insurance is satisfied that the number and amount of the transactions carried out by an insurer in any such sub-class of miscellaneous insurance business is so small as to render periodical valuation unnecessary, he may exempt that insurer from the operation of this sub-section in respect of that sub-class.

(7) The valuation of liabilities under sub-section (1) shall be carried out in such a manner and on such basis that the actuarial reserves calculated in that manner and on that basis are not less than the actuarial reserves calculated in the manner and on the basis laid down by the Chief Controller of Insurance in this behalf.

Section 14. Register of policies and register of claims

Every insurer, in the case of an insurer specified in sub-clause (a) (ii) or sub-clause (b) of clause (9) of section 2 in respect of all business transacted by him, and in the case of any other insurer in respect of the insurance business transacted by him in Bangladesh, shall maintain-

Section 15. Submission of returns

(1) The audited accounts and statements referred to in section 11 or sub-section (5) of section 13 and the abstract and statement referred to in section 13 shall be printed, and four copies thereof shall be furnished as returns to the Chief Controller of Insurance in the case of the accounts and statements referred to in section 11 or sub-section (5) of section 13 within six months and in the case of the abstract and statement referred to in section 13 within nine months from the end of the period to which they refer:

Provided that the said period of six months shall in the case of insurers having their principal place of business or domicile outside Bangladesh and in the case of insurers constituted, incorporated or domiciled in Bangladesh but also carrying on business outside Bangladesh be extended by three months, and provided further that the Chief Controller may in any case extend the time allowed by this sub-section for the furnishing of such returns by a further period not exceeding one month.

(2) Of the four copies so furnished one shall be signed in the case of a company by the Chairman and two directors and by the principal officer of the company and, if the company has a managing director by that director in the case of a firm, by two partners of the firm, and, in the case of an insurer being an individual, by the insurer himself and one shall be signed by the auditor who made the audit or the actuary who made the valuation, as the case may be.

(3) Where the insurer's principal place of business or domicile is outside Bangladesh, he shall forward to the Chief Controller of Insurance, along with the documents referred to in section 11, the balance-sheet, profit and loss account and revenue account and the valuation reports and valuation statements, if any, which the insurer is required to file with the public authority of the country in which the insurer is constituted, incorporated or domiciled, or, where such documents are not required to be filed, a certified statement showing the total assets and liabilities of the insurer at the close of the period covered by the said documents and his total income and expenditure during that period.

Section 16. [Omitted.]

[Returns by insurers established outside the Provinces etc.- Omitted by section 16 of the Insurance (Amendment) Act, 1958 (Act No. XXVII of 1958).]

Section 17A. [Omitted.]

[This Act not to apply to preparation of accounts, etc. for periods prior to this Act coming into force.- Omitted by section 17 of the Insurance (Amendment) Act, 1958 (Act No. XXVII of 1958). ]

Section 17. Exemption from certain provisions of the Companies Act, 1913

Where an insurer, being a company incorporated under the Companies Act, 1913 or under the Indian Companies Act, 1882, or under the Indian Companies Act, 1866, or under any Act repealed thereby, in any year furnishes his balance sheet and accounts in accordance with the provisions of section 15, he may at the same time send to the Registrar of Companies copies of such balance-sheet and accounts; and where such copies are so sent it shall not be necessary for the company to file copies of the balance-sheet and accounts with the Registrar as required by sub-section (1) of section 134 of the first mentioned Act and such copies so sent shall be chargeable with the same fees and shall be dealt with in all respects as if they were filed in accordance with that section.

Section 18. Furnishing reports

Every insurer shall furnish to the Chief Controller of Insurance a certified copy of every report on the affairs of the concern which is submitted to the members or policy-holders of the insurer immediately after its submission to the members or policy-holders as the case may be.

Section 19. Abstract of proceedings of general meetings

Every insurer, being a company or body incorporated under any law for the time being in force in Bangladesh, shall furnish to the Chief Controller of Insurance a certified copy of the minutes of the proceedings of every general meeting as entered in the Minutes Book of the insurer within thirty days from the holding of the meeting to which it relates.

Section 20. Custody and inspection of documents and supply of copies

(1) Every return furnished to the Chief Controller of Insurance or a certified copy thereof shall be kept by the Chief Controller and shall be open to inspection; and any person may procure a copy of any such return, or of any part thereof, on payment of a fee of ⁴²two Taka for every hundred words or fractional part thereof required to be copied, any five figures being deemed equivalent to one word.

(2) A printed or certified copy of the accounts, statements and abstract furnished in accordance with the provisions of section 15 shall, on the application of any shareholder or policy-holder made at any time within two years from the date on which the document was so furnished, be supplied to him by the insurer within fourteen days when the insurer is constituted, incorporated or domiciled in Bangladesh and in any other case within one month of such application.

(3) A copy of the memorandum and Articles of Association of the insurer, if a company, shall on the application of any policy-holder, be supplied to him by the insurer on payment of one Taka.

Section 21. Powers of Chief Controller of Insurance regarding returns

(1) If it appears to the Chief Controller of Insurance that any return furnished to him under the provisions of this Act is inaccurate or defective in any respect, he may-

(2) [Omitted by section 11 of the Insurance (Amendment) Ordinance, 1970 (Ordinance No. XXV of 1970).]

Section 22. Power of Chief Controller of Insurance to order revaluation 23. Evidence of documents

(1) If it appears to the Chief Controller of Insurance that an investigation or valuation to which section 13 refers does not properly indicate the condition of the affairs of the insurer by reason of the faulty basis adopted in the valuation, he may, after giving notice to the insurer and giving him an opportunity to be heard, cause an investigation and valuation as at such date as the Chief Controller of Insurance may specify to be made at the expense of the insurer by an actuary appointed by the insurer for this purpose and approved by the Chief Controller of Insurance and the insurer shall place at the disposal of the actuary so appointed and approved all the material required by

the actuary for the purposes of the investigation and valuation within such period, not being less than three months, as the Chief Controller of Insurance may specify.

(2) The provisions of sub-sections (1) and (4) of section 13, and of sub-sections (1) and (2) of section 15 shall apply in relation to an investigation and valuation under this section:

Provided that the abstract and statement prepared as the result of such investigation and valuation shall be furnished by such date as the Chief Controller of Insurance may specify.

Section 23. Evidence of documents

(1) Every return furnished to the Chief Controller of Insurance, which has been certified by the Chief Controller to be a return so furnished, shall be deemed to be a return so furnished.

(2) Every document, purporting to be certified by the Chief Controller of Insurance, to be a copy of a return so furnished, shall be deemed to be a copy of that return and shall be received in evidence as if it were the original return, unless some variation between it and the original return is proved.

Section 24. [Omitted.]

[Summary of returns to be published.- Omitted by section 16 of the Insurance (Amendment) Act, 1941 (Act No. XIII of 1941).]

Section 25. Returns to be published in statutory forms

(1) No insurer shall,-

Provided that nothing contained in this section shall prevent an insurer from publishing any return in a form in which it has been furnished to the Chief Controller of Insurance or a true and accurate abstract from such returns or any other factual statement for the purposes of publicity.

Section 26. Alterations in the particulars furnished with application for registration to be reported

Whenever any alteration occurs or is made which affects any of the matters which are required under the provisions of sub-section (2) of section 3 to accompany an application by an insurer for registration, the insurer shall forthwith furnish to the Chief Controller of Insurance full particulars of such alteration.

All such particulars shall be authenticated in the manner required by that sub-section for the authentication of the matters therein referred to, and, where the alteration affects the assured rates, advantages, terms and conditions offered in connection with life insurance policies, the actuarial certificate referred to in clause (f) of the said sub-section shall accompany the particulars of the alteration.

Restriction on certain investments, etc.

⁴³27B. Except with the prior approval of the Board of Directors at a regularly convened meeting by the vote of not less than two-thirds of the total number of directors and also upon a reference by the Board, of the Government, no insurer shall invest in, or hold any shares or debentures of, any company, firm or other business concern in which any of its directors, or any member of the family of such director, has any interest as proprietor, partner, director, manager or managing agent: Restriction on certain investments etc.

Provided that no investment shall be permissible in the first issue of capital by a company, firm or other business concern in which any of the directors of the insurer or any member of the family of such director has any interest as proprietor, partner, director, manager or managing agent.

Section 27. Investment of assets

(1) Every insurer shall invest and at all times keep invested in the manner provided in sub-section (2) assets equivalent to not less than the sum of -

Provided that where an insurer has accepted reassurance in respect of any policies of life insurance issued by another insurer and maturing for payment in Bangladesh or has ceded reassurance to another insurer in respect of any such policies issued by himself, the said sum shall be increased by the amount of the liability involved in such acceptance and decreased by the amount of liability involved in such cession:

Provided further that the said sum shall not be decreased by the amount of any liability in respect of any reinsurances ceded to an insurer not registered in Bangladesh for life insurance business except to the extent of the amount of the liability incurred up to the 31st December, 1957.

(2) The investment required under sub-section (1) shall be made in the following manner, namely:-

⁴⁴(i) thirty per cent of the sum referred to in the said sub-section shall be invested in Government securities; and

Explanation.- For the purpose of this sub-section the amount of any deposits made under section 7 or section 98 by the insurer in respect of his life insurance business shall be deemed to be invested or kept invested in Government securities.

⁴⁵(2A) If at any time the Government is of the opinion that any investment made by an insurer in pursuance of sub-section (2) is not suitable or desirable, it may, after giving the insurer an opportunity of being heard, direct him to realise the investment within such time as may be specified in the direction and to re-invest the amount so realised in accordance with the provisions of this section.

(3) In computing the assets required by this section to be kept invested by an insurer, a sum equal to the amount of his liabilities to persons who are not citizens of Bangladesh in respect of life insurance policies issued in Bangladesh in favour of such persons but expressed in a currency other than the Bangladesh Taka may, if such sum is invested in securities of, and guaranteed as to principal and interest by, the Government of the country in whose currency such policies are expressed, be taken into account.

(4) The assets required by this section to be kept invested by an insurer shall be deposited by the insurer in Bangladesh for safe custody in the prescribed manner with a scheduled bank approved by the Government and the assets so deposited shall not be released or dealt with in any manner except in such circumstances and in such manner as may be prescribed:

Provided that the Government may, by notification in the official Gazette, exclude from the requirements of this sub-section any approved investments which cannot be deposited for safe custody with a scheduled bank on account of the nature of such investments.

Insurers of general insurance business to have assets invested in Bangladesh

⁴⁶27A. (1) Every insurer transacting general insurance business in Bangladesh shall have assets invested in Bangladesh exceeding his liabilities by at least a sum of five lakhs of Taka or ten per cent of the net premium income, whichever is the higher:

Provided that an insurer defined in sub-clause (a) (ii) or sub-clause (b) of clause (9) of section 2 who has no paid-up capital or has a paid-up capital of less than five lakhs of Taka shall be deemed to have complied with the requirements of this sub-section if the assets invested by him in Bangladesh, not being less than ten per cent of the net premium income, exceed his liability,-

(2) For the purpose of sub-section (1), the following shall be deemed to be the liability of the insurer, namely:-

Explanation.- Marine and Aviation Hull insurance business shall include any policies issued to an owner of a vessel or aircraft relating to any interest of such an owner in respect of a vessel or aircraft.

(3) For the purpose of computing assets referred to in sub-section (1), the following shall be excluded to the extent specified, namely:-

(4) Notwithstanding anything contained in sub-section (1), an insurer carrying on business at the commencement of the Insurance (Amendment) Ordinance, 1960, to whom that sub-section applies, shall be deemed to have complied with the requirements of this section if he has invested not less than one-fourth of the amount required to be invested before 31st December, 1960, not less than one-half before 31st December, 1961, and not less than three fourth before 31st December, 1962.

(5) Every insurer carrying on general insurance business in Bangladesh shall, along with the returns under section 15, submit to the Chief Controller of insurance a return certified by an auditor showing as at 31st day of December of the preceding year the assets invested in Bangladesh and all other particulars necessary to establish that the requirements of this section have been complied with and such return shall be certified by a principal officer of the insurer.

(6) The Chief Controller of Insurance may, at any time, take such steps as he may consider necessary for the inspection or verification of the assets invested in pursuance of sub-section (1) or for the purpose of securing the particulars necessary to establish that the requirements of that sub-section have been complied with and the insurer shall comply with any requisition made in this behalf by the Chief Controller of Insurance and if he fails to do so within two months from the receipt of the requisition he shall be deemed to have made default in complying with the requirements of this section.

Section 28. Statement of investments of assets

(1) Every insurer registered under this Act carrying on the business of life insurance shall every year, within thirty-one days from the beginning of the year, submit to the Chief Statement of investments of assets

Controller of Insurance a return showing as at the 31st day of December of the preceding year the assets held invested in accordance with section 27, and all other particulars necessary to establish that the requirements of that section have been complied with, and such return shall be certified by a principal officer of the insurer.

(2) Every such insurer shall also furnish, within fifteen days from the last day of March, June and September, a return certified as aforesaid showing as at the end of each of the said months the assets held invested in accordance with section 27.

(3) The Chief Controller of Insurance may at his discretion require any insurer to whom sub-section (1) applies to submit before the 1st day of August in each or any year a return of the nature referred to in sub-section (1), certified as required by that sub-section and prepared as at the 30th day of June.

(4) In the case of an insurer having his principal place of business or domicile outside Bangladesh, the Chief Controller of Insurance may, on application made by the insurer, extend the periods of fifteen and thirty-one days mentioned in the foregoing sub-sections to thirty days and sixty days, respectively.

(5) The Chief Controller of Insurance shall be entitled at any time to take such steps as he may consider necessary for the inspection or verification of the assets invested in compliance with section 27 or for the purpose of securing the particulars necessary to establish that the requirements of that section have been complied with. The insurer shall comply with any requisition made in this behalf by the Chief Controller of Insurance, and if he fails to do so within two months from the receipt of the requisition he shall be deemed to have made default in complying with the requirements of this section.

Section 29. Prohibition of loans

(1) No insurer shall grant to, or to any member of the family of, any director, manager, actuary, auditor or officer of the insurer any loan or temporary advance, either on hypothecation or property or on personal security or otherwise, except a loan on life policies issued by the insurer within the surrender value.

(2) Except with the prior approval of the Board of Directors at a regularly convened meeting by the vote of not less than two-thirds of the total number of directors and also, upon a reference by the Board, of the Government, no insurer shall grant any loan or temporary advance to any firm or company in which any director, manager, actuary, auditor or officer of the insurer, or any member of the family of such director, manager, actuary, auditor or officer, has any interest as proprietor, partner, director, manager or managing agent.

(3) The director concerned shall not vote at, or otherwise participate in, the proceedings of the meeting of the Board considering the grant of any such loan or advance as is referred to in sub-section (2).

(4) Where any event occurs giving rise to circumstances the existence of which at the time of the grant of any subsisting loan or temporary advance would have made such grant a contravention of sub-section (1) or sub-section (2), such loan shall, notwithstanding any contract to the contrary, be repaid within three months from the occurrence of such event and, in case of default, the director, manager, actuary, auditor or officer concerned shall, without prejudice to any other penalty to which he may be liable, cease to hold office with the insurer granting the loan or advance on the expiry of the said three months.

(5) Nothing in sub-section (1) or sub-section (2) shall apply to loans or advances granted by an insurer to a banking company or to a subsidiary company being an insurer or to any insurer to which the insurer granting the loan or advance is a subsidiary company.

(6) Nothing in sub-section (1) shall apply to any stipend paid to any insurance agent or employer of agents while he is undergoing a course of training approved by the Government.

(7) The provisions of section 86D of the Companies Act, 1913 (VII of 1913), shall not apply to a loan granted to a director of an insurer being a company, if the loan is one granted on the security of a policy on which the insurer bears the risk and the policy was issued to the director on his own life, and the loan is within the surrender value of the policy.

(8) Subject to the provisions of sub-section (1) no insurer shall grant to any employee, insurance agent or employer of agents any loan or temporary advances except-

Provided that the total loan referred to in sub-clause (b) (iv) and (c) shall not exceed ten per cent of the net profit of the preceding year of the insurer after payment of income tax;

Provided that, in respect of the life insurance business of an insurer, the total temporary advances referred to in this clause shall not exceed at any time ten thousand Taka, in the case of insurers having a life insurance

fund of less than ten lakhs of Taka and one per cent of the life insurance fund subject to a maximum of two hundred thousand Taka, in any other case.

Section 30. Liability of directors, etc., for loss due to contraventions of sections 27 and 29

If by reason of contravention of any of the provisions of section 27 or section 29, any loss is sustained by the insurer or by the policy-holders, every director, manager, officer or partner who is knowingly a party to such contravention shall, without prejudice to any other penalty to which he may be liable under this Act, be jointly and severally liable to make good the amount of such loss.

Section 32. Appointment of managing agent prohibited

No insurer shall appoint a managing agent for the conduct of his business.

Section 31. Assets of insurer how to be kept

(1) None of the assets in Bangladesh of any insurer shall, except in the case of deposits made with the Bangladesh Bank under section 7 or section 98 or in so far as assets are required to be deposited for safe custody with a scheduled bank under sub-section (4) of section 27, be kept otherwise than in the name of a public officer approved by the Government, or in the corporate name of the undertaking, if a company, or in the name of the partners, if a firm, or in the name of the proprietor, if an individual.

(2) [Omitted by section 3 and the Second Schedule of the Bangladesh Laws (Revision And Declaration) Act, 1973 (Act No. VIII of 1973).]

Power to restrict payment of excessive remuneration

⁵¹32A. (1) The Chief Controller of Insurance may, if he is satisfied that any insurer in the case of an insurer specified in sub-clause (a) (ii) or sub-clause (b) of clause (9) of section 2 in respect of all insurance business transacted by him and in the case of any other insurer in respect of the insurance business transacted by him in Bangladesh is paying any person remuneration, whether by way of commission or otherwise, on a scale disproportionate according to the normal standards prevailing in insurance business to the resources of the insurer, call upon the insurer to comply within six months with such directions as he may think fit to issue in the matter and if compliance with the direction so issued required the modification of any of the terms of the contract entered into by the insurer with such person no compensation shall be payable to such person by the insurer by reason only of such modification or of the resignation of such person if the modified terms are not acceptable to him and no payment by way of renewal commission or otherwise shall be made to such person by the insurer in respect of any payments made after the date of such resignation except at such rates as may be approved by the Chief Controller of Insurance in this behalf.

(2) Every insurer shall before the 30th day of June, 1958, and thereafter before the first day of March every year submit to the Chief Controller of Insurance a statement in the prescribed form showing the remuneration paid by way of commission or otherwise to any person in cases where such remuneration exceeds the sum of six thousand Taka in the previous calendar year.

(3) Where an insurer pays any person remuneration exceeding six thousand Taka a year in pursuance of any agreement between him and such person, the Chief Controller may, by notice in writing, require the insurer to submit a certified copy of such agreement and the insurer shall comply with any such requisition within the time specified in the notice.

Section 32B. Provisions relating to managers, etc.

(1) Notwithstanding anything to the contrary contained in the Companies Act, 1913, or in the Articles of Association of the insurer, if a company, or in any contract or agreement, no insurer shall, after the expiry of one year from the commencement of the Insurance (Amendment) Act, 1958, be directed or managed by, or employ as manager or officer or in any capacity, any person whose remuneration or any part thereof takes the form of commission or bonus on the total insurance business or on the total business of any class or sub-class of insurance business or on a part of any class or sub-class of general insurance business transacted by the insurer:

Provided that nothing in this sub-section shall be deemed to prohibit-

(2) No person shall have any right, whether in contract or otherwise, to any compensation for any loss incurred by reason of the operation of any provision of this section.]

Section 33. Power of Chief Controller of Insurance to order investigation

(1) The Chief Controller may, at any time investigate the affairs of an insurer and, wherever necessary, employ an auditor or actuary or both for assisting him in any such investigation.

(2) It shall be the duty of every manager, managing director or other officer of the insurer to produce before the Chief Controller, auditor or actuary all such books of account, registers and other documents in his custody or power and to furnish him with any such statement or information relating to the affairs of the insurer within such time as the Chief Controller, auditor or actuary may require.

(3) When an investigation is made under this section, the Chief Controller may, after giving an opportunity to the insurer to make a representation in writing or be heard in person, by order in writing,-

(4) No order made under this section other than an order made under clause (b) of sub-section (3) shall be called in question in any Court.

(5) All expenses of, and incidental to, any investigation made under this section shall be defrayed by the insurer, and shall have priority as debts due from the insurer and be recoverable as an arrear of land revenue.

Section 34. Powers of investigator

All the books and records of every insurer specified in sub-clause (a) (ii) or sub-clause (b) of clause (9) of section 2 in respect of all insurance business transacted by him and in the case of any other insurer in respect of the insurance business transacted by him in Bangladesh shall at all reasonable times be open to inspection by the Chief Controller of Insurance or any other person appointed by him in this behalf.

Power to give directions to the insurer

⁵²34A. (1) The Chief Controller of Insurance may, from time to time, issue such directions as he may deem fit to all or any of the insurers if he is satisfied that it is necessary so to do-

(2) The Chief Controller of Insurance may, on representation made in this behalf, or on his own motion, modify or cancel any direction issued under sub-section (1) and may, in so modifying or cancelling a direction, impose such conditions as he may deem fit.

(3) Every insurer shall comply with any direction issued under sub-section (1) or such direction as modified under sub-section (2) subject to conditions, if any.

(4) No direction under sub-section (1) or modification or cancellation under sub-section (2) or any such direction shall be issued without the prior approval of the Government.

Section 34B. Power to require calling of meeting of directors, etc.

The Chief Controller of Insurance may, during the course, or after the completion of special audit under section 12A or investigation under section 33, by order in writing, and on such terms and conditions as may be specified therein,-

Provided that such order has been passed with the prior approval of the Government; and

Section 34C. Power to remove Chairman, Director, etc., of the insurer

(1) If, after the completion of a special audit under section 12A or investigation under section 33, the Chief Controller has reason to believe that a person holding the office of the Chairman, a director, manager or principal officer, by whatever name called, of an insurer has contravened the provisions of any law and that the contravention is of such a nature that the association of such person with the insurer is or is likely to be detrimental to the interests of the insurer or of the policy-holders, or is otherwise undesirable, the Chief Controller shall, after giving such person an opportunity of being heard, make a report of the fact to the Government.

(2) If, after considering a report under sub-section (1), the Government is satisfied that the association with the insurer of the person in respect of whom the report has been made is or is likely to be detrimental to the interests of the insurer or of the policy-holders, or is otherwise undesirable, it may make an order that such person shall cease to hold the office with the insurer with effect from such date as may be specified in the order, and thereupon that office shall, with effect from the said date, become vacant.

(3) An order under sub-section (2) in respect of any person may also provide that he shall not, without the previous permission of the Government in writing, in any way, directly or indirectly, be concerned with, or take part in the management of, the insurer or any other insurer for such period not exceeding five years as may be specified in the order.

(4) No order under sub-section (2) shall be made in respect of any person without giving him an opportunity of being heard unless the Government is of the opinion that any delay in making the order would be detrimental to the interests of the insurer or of the policy-holders.]

Section 35. Amalgamation and transfer of Insurance business

(1) No life insurance business of an insurer specified in sub-clause (a) (ii) or sub-clause (b) of clause (9) of section 2 shall be transferred to any person or transferred to or amalgamated with the life insurance business of any other insurer except in accordance with a scheme prepared under this section and sanctioned by the Court having jurisdiction over one or other of the parties concerned.

(2) Any scheme prepared under this section shall set out the agreement under which the transfer or amalgamation is proposed to be effected, and shall contain such further provisions as may be necessary for giving effect to the scheme.

(3) Before an application is made to the Court to sanction any such scheme, notice of the intention to make the application together with a statement of the nature of the amalgamation or transfer, as the case may be and of the reason therefore shall, at least two months before the application is made, be sent to the Government, and certified copies, four in number, of each of the following documents shall be furnished to the Government, and other such copies shall during the two months aforesaid be kept open for the inspection of the members and policy-holders at the principal and branch offices and chief agencies of the insurers concerned, namely:-

The balance-sheets, reports and abstracts referred to in clauses (b), (c) and (d) shall all be prepared as at the date at which the amalgamation or transfer if sanctioned by the Court is to take effect, which date shall not be more than twelve months before the date on which the application to the Court is made under this section:

Provided that if the Government so directs in the case of any particular insurer there may be substituted respectively for the balance-sheet, report and abstract referred to in clauses (b) and (c) prepared in accordance with this sub-section certified copies of the last balance-sheet and last report and abstract prepared in accordance with sections 11 and 13 if that balance-sheet is prepared as at a date not more than twelve months, and that report and abstract as at a date not more than five years before the date on which the application to the Court is made under this section.

Section 36. Sanction of amalgamation and transfer by Court

When any application such as is referred to in sub-section (3) of section 35 is made to the Court, the Court shall cause, if for special reasons it so directs, notice of the application to be sent to every person resident in Bangladesh ⁵³* * * who is the holder of a life policy of any insurer concerned and shall cause a statement of the nature and terms of the amalgamation or transfer, as the case may be, to be published in such manner and for such period as it may direct, and after hearing the directors and such policy-holders as apply to be heard and any other persons whom it considers entitled to be heard, may sanction the arrangement, if it is satisfied that no Sanction of amalgamation and transfer by Court

sufficient objection to the arrangement has been established and shall make such consequential orders as are necessary to give effect to the arrangement, including orders as to the disposal of any deposit made under section 7 or section 98:

Provided that-

Section 37. Statements required after amalgamation and transfer

Where an amalgamation takes place between any two or more insurers, or where any business of an insurer is transferred whether in accordance with a scheme confirmed by the Court or otherwise, the insurer carrying on the amalgamated business or the person to whom the business is transferred as the case may be, shall, within three months from the date of the completion of the amalgamation or transfer, furnish in duplicate to the Government-

forth have been made or are to be made either in money, policies, bonds, valuable securities or other property by or with the knowledge of any parties to the amalgamation or transfer, and

Section 38. Assignment and transfer of insurance policies

(1) A transfer or assignment of a policy of life insurance, whether with or without consideration, may be made only by an endorsement upon the policy itself or by a separate instrument, signed in either case by the transferor or by the assignor or his duly authorised agent and attested by at least one witness, specifically setting forth the fact of transfer or assignment. Assignment and transfer of insurance policies

(2) The transfer or assignment shall be complete and effectual upon the execution of such endorsement or instrument duly attested but except where the transfer of assignment is in favour of the insurer shall not be operative as against an insurer and shall not confer upon the transferee or assignee, or his legal representative, any right to sue for the amount of such policy or the moneys secured thereby until a notice in writing of the transfer or assignment and either the said endorsement or instrument itself or a copy thereof certified to be correct by both transferor and transferee or their duly authorised agents have been delivered to the insurer:

Provided that where the insurer maintains one or more places of business in Bangladesh, such notice shall be delivered only at the place in Bangladesh mentioned in the policy for the purpose or at his principal place of business in Bangladesh.

(3) The date on which the notice referred to in sub-section (2) is delivered to the insurer shall regulate the priority of all claims under a transfer or assignment as between persons interested in the policy; and where there is more than one instrument of transfer or assignment the priority of the claims under such instruments shall be governed by the order in which the notices referred to in sub-section (2) are delivered.

(4) Upon the receipt of the notice referred to in sub-section (2), the insurer shall record the fact of such transfer or assignment together with the date thereof and the name of the transferee or the assignee and shall, on the request of the person by whom the notice was given, or of the transferee or assignee, on payment of a fee not exceeding one Taka grant a written acknowledgement of the receipt of such notice, and any such acknowledgment shall be conclusive evidence against the insurer that he has duly received the notice to which such acknowledgement relates.

(5) Subject to the terms and conditions of the transfer or assignment, the insurer shall, from the date of the receipt of the notice referred to in sub-section (2), recognise the transferee or assignee named in the notice as the only person entitled to benefit under the policy, and such person shall be subject to all liabilities and equities to which the transferor or assignor was subject at the date of the transfer or assignment and may institute any proceedings in relation to the policy without obtaining the consent of the transferor or assignor or making him a party to such proceedings.

(6) Any rights and remedies of an assignee or transferee of a policy of life insurance under an assignment or transfer effected prior to the commencement of this Act shall not be affected by the provisions of this section.

(7) Notwithstanding any law or custom having the force of law to the contrary, an assignment in favour of a person made with the condition that it shall be inoperative or that the interest

shall pass to some other person on the happening of a specified event during the lifetime of the person whose life is insured, and an assignment in favour of the survivor of survivors of a number of persons, shall be valid.

Section 39. Nomination by policy-holder

(1) The holder of a policy of life insurance on his own life, may, when effecting the policy or at any time before the policy matures for payment, nominate the person or persons to whom the money secured by the policy shall be paid in the event of his death: Nomination by policy-holder

Provided that where any nominee is a minor, it shall be lawful for the policy-holder to appoint in the prescribed manner any person to receive the money secured by the policy in the event of his death during the minority of the nominee.

(2) Any such nomination in order to be effectual shall, unless it is incorporated in the text of the policy itself, be made by an endorsement on the policy communicated to the insurer and registered by him in the records relating to the policy and any such nomination may at any time before the policy matures for payment be cancelled or changed by an endorsement or a further endorsement or a will, as the case may be, but unless notice in writing of any such cancellation or change has been delivered to the insurer, the insurer shall not be liable for any payment under the policy made bona fide by him to a nominee mentioned in the text of the policy or registered in records of the insurer.

(3) The insurer shall furnish to the policy-holder a written acknowledgement of having registered a nomination or a cancellation or change thereof, and may charge a fee not exceeding one Taka for registering such cancellation or change.

(4) A transfer or assignment of a policy made in accordance with section 38 shall automatically cancel a nomination:

Provided that the assignment of a policy to the insurer who bears the risk on the policy at the time of the assignment, in consideration of a loan granted by that insurer on the security of the policy within its surrender value, or its re-assignment on repayment of the loan shall not cancel a nomination, but shall affect the rights of the nominee only to the extent of the insurer's interest in the policy.

(5) Where the policy matures for payment during the lifetime of the person whose life is insured or where the nominee or, if there are more nominees, than one, all the nominees die before the policy matures for payment, the amount secured by the policy shall be payable to the policy-holder or his heirs or legal representatives or the holder of a succession certificate, as the case may be.

(6) Where the nominee or, if there are more nominees than one, a nominee or nominees survive the person whose life is insured, the amount secured by the policy shall be payable to such survivor or survivors.

(7) The provisions of this section shall not apply to any policy of life insurance to which section 6 of the Married Women's Property Act, 1874, applies or has at any time applied:

Provided that where a nomination made whether before or after the commencement of the Insurance (Amendment) Act, 1946, in favour of the wife of the person who has insured his life or of his wife and children or any of them is expressed, whether or not on the face of the policy, as being made under this section, the said section 6 shall be deemed not to apply or not to have applied to the policy.

Section 40. Prohibition of payment by way of commission or otherwise for procuring business

⁵⁴(1) No person shall pay or contract to pay any remuneration or reward whether by way of commission or otherwise for soliciting or procuring insurance business in Bangladesh to any person except an insurance agent or an employer of agent.

(1A) [Omitted by section 3 and the Second Schedule of the Bangladesh Laws (Revision And Declaration) Act, 1973 (Act No. VIII of 1973).]

⁵⁵(1B) No person shall pay and no insurance agent shall receive any renewal commission in respect of a life insurance business after the expiry of licence during the validity of which such business was procured by the insurance agent unless such licence has been renewed under sub-section (4) of section 42.

Explanation.- For the purposes of this sub-section all the life insurance business to the credit of an insurance agent as at the date of the expiry of his licence, shall be deemed to have been procured by the insurance agent while holding the licence valid on the said date.

(2) No insurance agent shall be paid or contract to be paid by way of commission or as remuneration ⁵⁶in any form an amount exceeding, in the case of life insurance business, forty per cent of the first year's premium payable on any policy or policies effected through him and five per cent of a renewal premium payable on such a policy, ⁵⁷or, in the case of business of any other class, fifteen per cent of the premium:

Provided that insurers, in respect of ⁵⁸life insurance policy only, may pay, during the first ten years of their business, to their insurance agents fifty-five per cent of the first year's premium payable on any policy or policies effected through them and six per cent of the renewal premiums payable on such policies.

⁵⁹* * *

⁶⁰(2A) Save as hereinafter provided, no insurance agent shall be paid or contract to be paid by way of commission or as remuneration in any form any amount in respect of any policy not effected through him:

Provided that where a policy of life insurance has lapsed, and it cannot, under the terms and conditions applicable to it be revived without further medical examination of the person whose life was insured thereby, an insurer, after giving by notice in writing, to the insurance agent through whom the policy was effected if such agent continues to be an agent of the insurer, an opportunity to effect the revival of the policy within a time specified in the notice, being not less than one month from the date of the receipt by him of the notice, may pay to another insurance agent who effects the revival of the policy an amount calculated at a rate not exceeding the rate of commission at which the agent through whom the policy was effected would have been paid had the policy not lapsed, on the sum payable on revival of the policy on account of arrear premiums (excluding any interest on such arrear premiums) and also on the subsequent renewal premiums payable on the policy.

(3) Nothing in this section shall prevent the payment under any contract existing prior to the 27th day of January, 1937, of gratuities or renewal commission to any person, whether an insurance agent within the meaning of this Act or not, or to his representatives after his decease in respect of insurance business effected through him before the said date.

Limitation of expenditure on commission

⁶¹40A. (1) No person shall pay or contract to pay an insurance agent, and no insurance agent shall receive or contract to receive by way of commission or remuneration in any form in respect of any policy of life insurance issued in Bangladesh by an insurer after the commencement of the Insurance (Amendment) Ordinance, 1970, and effected through an insurance agent, an amount exceeding such maximum percentage or below such minimum percentage as may be prescribed: Provided that in prescribing such percentages regard shall be had to -

⁶²(2) No person shall pay or contract to pay to an insurance agent, and no insurance agent shall receive or contract to receive by way of commission or remuneration in any form, in respect of any policy of general insurance issued in Bangladesh by an insurer and effected through an insurance agent an amount exceeding-

Provided that a further amount not exceeding five per cent of the premium payable on the policy may be paid to an insurance agent who procures a yearly business yielding a premium income of not less than thirty thousand Taka and satisfies such other conditions as may be prescribed.

(3) No person shall pay or contract to pay to any employer of agents and no employer of agents shall receive or contract to receive, by way of commission, over-riding commission or any other remuneration in any form, in respect of any policy of general insurance issued by an insurer in Bangladesh, and effected through an employer of agents, an amount exceeding-

inclusive of any commission payable to any insurance agent in respect of the said policy:

Provided that a further amount not exceeding five per cent of the premium payable on a policy may be paid to an employer of agents who procures a yearly business yielding a premium income of not less than one lakh Taka and satisfies such other conditions as may be prescribed:

Provided further that the Government may, in such circumstances and to such extent and for such period as may be specified, authorise the payment of commission or remuneration exceeding the limits specified in this sub-section to an employer of agents acting on behalf of an insurer incorporated or domiciled elsewhere than in Bangladesh if such employer of agents carries out and has continuously carried out in his own office duties on behalf of the insurer which would otherwise have been performed by the insurer.

⁶³(3A) No person shall pay or contract to pay any employer of agents, and no employer of agents shall receive or contract to receive, by way of commission, over-riding commission or any other remuneration in any form, in respect of any life insurance policy issued by an insurer in Bangladesh after the commencement of the Insurance (Amendment) Ordinance, 1970, and effected through an employer of agents, an amount exceeding such maximum percentage or below such minimum percentage as may be prescribed:

Provided that in prescribing such percentages regard shall be had to-

(3B) No insurer shall pay over-riding commission to more than two employers of agents intervening between him and the insurance agents.

(3C) Where an employer of agents also works as an agent, the insurer may, subject to any rules made in this behalf, pay over-riding commission to him in respect of business procured by him as an insurance agent:

Provided that the insurer shall not pay over-riding commission to an employer of agents on the business procured by him as an insurance agent if such business exceeds such percentages as may be prescribed.

(4) No insurer shall pay or contract to pay outside Bangladesh to any person any commission in any form in respect of the insurance business transacted by such person in Bangladesh and no insurer shall receive or contract to receive outside Bangladesh from any person any commission in any form in respect of any business reinsured abroad.

(5) Without prejudice to the provisions of section 102 in respect of a contravention of any of the provisions of the preceding sub-section by an insurer, an insurance agent or employer of agents who contravenes any of the provisions of sub-sections (1) ⁶⁴, (2), (3) or (4) shall be punishable with fine which may extend to one thousand Taka.

(6) An insurer incorporated outside Bangladesh who receives or contracts to receive any commission in respect of any business transacted in Bangladesh and reinsured abroad shall not be deemed to have contravened the provisions of sub-section (4) if all amounts received by him outside Bangladesh in this respect have been fully credited to the Bangladesh revenue account.

Section 40D. Remuneration

For the purposes of sections 32A, 40, 40A, 40B and 40C, “remuneration” shall be deemed to include travelling and entertainment allowances and all other payments or disbursements of any kind or form.]

Section 40B. Limitation of expenses of management in life insurance business

(1) No insurer shall, in respect of life insurance business transacted by him in Bangladesh, spend as expenses of management in any calendar year an amount in excess of the prescribed limits and in prescribing any such limits regard shall be had to the size and age of the insurer and the provision generally made for expenses of management in the premium rates of insurers:

Provided that the Chief Controller of Insurance may, on an application made to him in this behalf, condone the contravention of this sub-section by an insurer who has, on reasonable grounds, spent as such expenses an amount in excess of such limits.

(2) Every insurer transacting life insurance business in Bangladesh shall incorporate in the revenue account-

Explanation.- In this section “expenses of management” means all charges wherever incurred whether directly or indirectly, and includes:-

Section 40C. Limitation of expenses of management in general insurance business

(1) No insurer shall, in respect of any class of general insurance business transacted by him in Bangladesh, spend in any calendar year as expenses of management ⁶⁵, including commission or remuneration for procuring business, an amount in excess of the prescribed limits and in prescribing any such limits regard shall be had to the size and age of the insurer:

Provided that the Chief Controller of Insurance may, on an application made to him in this behalf, condone the contravention of this sub-section by an insurer who has, on reasonable grounds, spent as such expenses an amount in excess of such limits.

(2) Every insurer as aforesaid shall incorporate in the revenue account a certificate signed by the chairman, two directors and the principal officer of the insurer, and an auditor's certificate, certifying that all expenses of management wherever incurred, whether directly or indirectly, in respect of the business referred to in this section have been fully debited in the revenue account as expenses.

Explanation.- In this section,-

Section 41. Prohibition of rebates

(1) No person shall allow or offer to allow, either directly or indirectly, as an inducement to any person to take out or renew or continue an insurance in respect of any kind of risk relating to lives or property in Bangladesh any rebate of the whole or part of the commission payable or any rebate of the premium shown on the policy, nor shall any person taking out or renewing or continuing a policy accept any rebate, except such rebate as may be allowed in accordance with the published prospectuses or tables of the insurer:

Provided that acceptance by an insurance agent of Commission in connection with a policy of life insurance taken out by himself on his own life shall not be deemed to be acceptance of a rebate of premium within the meaning of this sub-section if at the time of such acceptance the insurance agent satisfies the prescribed conditions establishing that he is a bona fide insurance agent employed by the insurer.

(2) Any person making default in complying with the provisions of this section shall be punishable with fine which may extend to five hundred Taka.

Section 42. Licensing of insurance agents

(1) Any person who possesses such qualifications as may be prescribed in this behalf and who makes an application in the prescribed manner to the Chief Controller of Insurance accompanied by the prescribed fee, which shall not be more than ⁶⁶two hundred Taka may be granted a temporary licence for the purpose of soliciting or procuring life insurance business.

(2) A temporary licence issued under sub-section (1) shall remain in force for a period of two years.

(3) On his making an application to the Chief Controller of Insurance in the prescribed manner accompanied by the prescribed fee, the holder of a temporary licence who has passed such examination as may be prescribed, and any other person who has passed the examination, shall be granted a renewable licence.

(4) A renewable licence shall remain in force for a period of three years from the date of issue but shall be renewed for a further period of three years at any one time if-

(5) A person to whom a temporary licence is granted and who is unable to pass the examination prescribed under sub-section (3) shall not be entitled to apply for another temporary licence:

Provided that the Chief Controller may grant a fresh temporary licence to a person who has previously held a temporary licence if such person has procured such volume of business, and from out of the business procured by whom the number of policies lapsing is below such percentage as may be prescribed.

⁶⁸(6) The Chief Controller of Insurance or an officer authorised by him in this behalf shall, in the prescribed manner and on payment of prescribed fee, which shall not be more than ⁶⁹two hundred Taka, issue to any individual making an application in the prescribed manner a licence to act as an insurance agent for the purpose of soliciting or procuring general insurance business.

(7) A licence issued under sub-section (6) shall remain in force for a period of one year from the date of issue but shall be renewed for a period of three years at any one time if :-

(8) No fresh licence for general insurance business shall be issued to an insurance agent whose licence has not been renewed under sub-section (7), until after one year from the date on which his last licence ceased to remain in force.

(9) Notwithstanding the provisions of clause (i) of sub-section (4) ⁷⁰or clause (i) of sub-section (7), an application for the renewal of a licence which does not reach the issuing authority at least one month before the date on which the licence ceases to remain in force shall be entertained at any time before that date if the applicant has paid an additional fee of a prescribed amount not exceeding five Taka by way of penalty:

Provided that the Chief Controller of Insurance may, if satisfied that undue hardship would be caused otherwise, entertain an application received after the licence ceases to remain in force on payment by the applicant of a penalty of a prescribed amount not exceeding thirty Taka.

⁷¹(10) For the purpose of sections 40 and 40A, no insurance agent who is licensed to act as an insurance agent for life insurance business be deemed to be an insurance agent for general insurance business and no insurance agent who is licensed to act as an insurance agent for general insurance business shall be deemed to be an insurance agent for life insurance business.

(11) A licence issued under this section shall entitle the holder thereof to act as an insurance agent for any insurer.

(12) No person shall apply for temporary or renewable licence or apply for the renewal of a licence in respect of life insurance business ⁷²or a licence in respect of general insurance business if:-

Provided that where, in the case of a person convicted of any such offence, five years have elapsed since the date of the sentence or, where the sentence was of imprisonment with or without fine, from the date of his release, the Chief Controller of Insurance shall ordinarily declare in respect of such person that his conviction shall cease to debar him from making such an application.

(13) If it be found that an insurance agent is debarred by sub-section (12) from making an application, without prejudice to any other penalty to which he may be liable, the Chief Controller of Insurance shall, and if the agent has knowingly contravened any provision of this Act, or any rule or order made thereunder may, cancel a licence issued to the agent under this section.

(14) In the event of the cancellation of a licence under sub-section (13), the Chief Controller of Insurance may refuse to grant a fresh licence to the insurance agent for such period as the Chief Controller deems fit.

(15) The authority which issued any licence under this section may issue a duplicate licence to replace a licence lost, destroyed or mutilated on payment of the prescribed fee which shall not be more than one Taka.

(16) The Chief Controller shall if he refuses any licence or the renewal of any licence under this section, communicate his decision in writing to the applicant for the licence or the renewal within six weeks of the date of the application.]

Certificates to employers of agents

⁷³42A. (1) Any individual who has-

may be granted a temporary certificate to act as an employer of agents on behalf of an insurer for the purpose of procuring life insurance business.

(2) A temporary certificate issued under sub-section (1) shall remain in force for a period of two years.

(3) On his making to the Chief Controller of Insurance in the prescribed manner an application accompanied by the prescribed fee which shall not be more than ⁷⁵seven hundred and fifty Taka, the holder of a temporary certificate who has passed such examination as may be prescribed, and any other person who is qualified to be granted a temporary certificate and has passed the examination, shall be granted a renewable certificate.

(4) A renewable certificate shall remain in force for a period of three years from the date of issue but shall be renewed for a further period of three years at any one time if-

(5) An individual to whom a temporary certificate has been granted and who is unable to pass the examination prescribed under sub-section (3) shall not be entitled to apply for another temporary certificate:

Provided that the Chief Controller of Insurance may grant a fresh temporary certificate to an individual who has previously held a temporary certificate if such individual has introduced such number of agents who have qualified for a renewable licence and produced such volume of business and from out of the business procured by whom the number of policies lapsing has been below such percentage as may be prescribed.

(6) Notwithstanding the provisions of clause (i) of sub-section (4), an application for the renewal of a renewable certificate which does not reach the issuing authority at least one month from the date on which the certificate ceases to remain in force shall be entertained at any time before that date if the applicant has paid an additional fee of a prescribed amount not exceeding ⁷⁷two hundred and fifty Taka by way of penalty:

Provided that the Chief Controller of Insurance may, if satisfied that undue hardship would be caused otherwise, entertain an application received after the certificate ceases to remain in force on payment by the application of a penalty of a prescribed amount not exceeding ⁷⁸seven hundred and fifty Taka.

⁷⁹(7) The Chief Controller of Insurance or an officer authorised by him in this behalf shall, in the prescribed manner and on payment of the prescribed fee which shall not be more than five hundred Taka, issue to any person making an application in the prescribed manner a certificate to act as an employer of agents on behalf of an insurer for the purposes of procuring general insurance business.

(8) A certificate issued under sub-section (7) shall remain in force for a period of one year from the date of issue, but shall, on application made in this behalf, be renewed from year to year if-

Provided that an application for the renewal of a certificate which does not reach the issuing authority before the certificate ceases to remain in force shall be entertained if the applicant has submitted an application within twelve months from the date the certificate ceases to remain in force and has paid an additional fee of the prescribed amount not exceeding five hundred Taka by way of penalty.

(9) No fresh certificate shall be issued to an employer of agents whose certificate has not been renewed under sub-section (8), until after one year from the date on which his last certificate ceased to remain in force.

(10) No person shall apply for any certificate or for the renewal thereof if-

Provided that where, in the case of a person convicted of any such offence, five years have elapsed since date of the sentence or, where the sentence was of imprisonment with or without fine, from the date of his release, the Chief Controller of Insurance shall ordinarily declare in respect of such person that his conviction shall cease to debar him from making such an application;

(11) Where it is found that an employer of agents being an individual is, or being a company or firm contains a director or partner who is, debarred by sub-section (10) from making an application, without prejudice to any other penalty to which he may be liable, the Chief Controller of Insurance shall, and where an employer of agents has contravened any of the provisions of this Act or any rule or order made thereunder may, cancel a certificate issued to the employer of agents under this section.

(12) In the event of the cancellation of a certificate under sub-section (11), the Chief Controller of Insurance may refuse to grant a fresh certificate to the employer of agents for such period as the Chief Controller may deem fit.

(13) The authority which issued any certificate under this section may issue a duplicate certificate to replace a certificate lost, destroyed or mutilated on payment of the prescribed fee, which shall not be more than five Taka.

(14) A certificate issued under this section shall entitle the holder thereof to act as an employer of agents for any insurer.

(15) The Chief Controller shall, if he refuses a certificate or the renewal of a certificate under this section, communicate his decision in writing to the applicant for the certificate or renewal within six weeks from the date of the application.

Powers to ensure compliance with certain provisions

⁸⁰42B. For the purposes of ensuring compliance with the provisions of sections 40, 40A, 40B, 40C, 42, 42A, 44A and 44B the Chief Controller may, by notice,-

Provisions of contracts with agents

⁸¹43A. Every contract made by an insurer with an insurance agent or employer of agents shall contain such provisions as may be prescribed and every such contract in force immediately before the commencement of the Insurance (Amendment) Ordinance, 1970, shall be deemed to contain the said provisions or provisions to the same effect.

Section 43. Register of insurance agents

(1) Every insurer and every person who acting on behalf of an insurer employs insurance agents shall maintain a register showing the name and address of every insurance agent appointed by him and the date on which his appointment began and the date, if any, on which his appointment ceased.

(2) Any individual not holding a licence issued under section 42 who acts as an insurance agent shall be punishable with fine which may extend to fifty Taka, and any insurer who, or any person acting on behalf of an insurer who, appoints as an insurance agent any individual not so licensed, or transacts any insurance business in Bangladesh through any such individual, shall be punishable with fine which may extend to one hundred Taka.

(3) The provisions of sub-section (2) shall not take effect until the expiry of six months from the commencement of this Act.

Section 44. Prohibition of cessation of payment of commission

(1) Notwithstanding anything to the contrary contained in any contract between any person and any insurance agent providing for the forfeiture or stoppage of payment of renewal commission to such insurance agent, no such person shall, in respect of life insurance business transacted in Bangladesh, refuse payment to an insurance agent of commission due to him on renewal premium under the agreement by reason only of the termination of his agreement, except for fraud:

Provided that-

(2) Any commission payable to an insurance agent whether under the provisions of sub-section (1) or otherwise shall, notwithstanding the death of the agent and notwithstanding the provisions in this Act regarding the holding of an insurance agent's licence continue to be payable to his heirs for so long as such commission would have been payable had such insurance agent been alive or in one or more lump sums commuted under sub-section (4):

Provided that no commission on renewal premiums shall be paid under this sub-section if the total amount of commission on renewal premiums earned by the insurance agent during the twelve months preceding the date of his death was less than three hundred Taka.

(3) For the purposes of sub-section (2) an insurance agent may nominate the person or persons to whom the commission due to him shall be paid in the event of his death:

Provided that any such nomination to be effectual shall be communicated to the insurer and registered by him in writing and any such nomination may at any time before the death of the insurance agent, be cancelled or changed by him, but unless a notice in writing of any such cancellation or change has been delivered to the insurer, the insurer shall not be liable for any payment of the commission made bona fide by him to a nominee registered with the insurer:

Provided further that the insurer shall furnish to the insurance agent a written acknowledgment of having registered nomination or cancellation or change thereof :

Provided also that where the nominee is a minor, it shall be lawful for the insurance agent to appoint any person to receive the commission in the event of his death during the minority of the nominee.

(4) If the commission payable to any heir or nominee of a deceased insurance agent under the provisions of sub-section (2) is less than three hundred Taka a year, the insurer shall and in any other case the insurer may, with the consent of the heir or the nominee of the deceased insurance agent, commute such renewal commission and pay the amount or amounts mutually agreed to in lump sum or sums.

(5) An insurer may recover out of the commission payable under sub-section (2) any sums owing to the insurer by the insurance agent at the date of his death.

(6) In this section, reference to “insurance agent” or “agent” shall be construed as including reference to “employer of agent”, and reference to “commission” shall be construed as including reference to “over-riding commission”.

Insurance surveyors to hold certificates

⁸²44A. (1) No person other than an insurance surveyor holding an appropriate certificate under this section shall, after the expiry of six months from the commencement of the Insurance (Amendment) Act, 1958, undertake in Bangladesh the surveying assessment or adjustment of any loss in respect of general insurance business and no insurer shall pay any claim in respect of general insurance business transacted by him in Bangladesh unless the loss has been surveyed, assessed or adjusted, as the case may be, by an insurance surveyor holding an appropriate certificate under this section:

Provided that the provisions of this sub-section shall not apply to such persons and to such losses as may be prescribed.

(2) An application for a certificate under this section shall be made to the Chief Controller of Insurance in the prescribed manner and be accompanied by a prescribed fee which shall not be more than ⁸³two thousand Taka.

(3) The insurance surveyors may be classified into such classes or sub-classes as may be prescribed, and, if so classified, separate application shall be made and separate certificates issued in respect of each such class or sub-class.

(4) The Chief Controller of Insurance or any person authorised by him in this behalf may, on receipt of an application under this section, call for such information or explanation as he may deem fit, or ask the applicant to appear before him in person, and on being satisfied that the applicant fulfils such requirements as may be prescribed and is fit to hold the certificate applied for, grant such certificate.

(5) An applicant who has been refused a certificate of any class or sub-class under sub-section (4) shall not be entitled to make a fresh application for a certificate of the same class or sub-class before the expiry of a period of one year from the date of such refusal.

(6) A certificate issued under this section shall remain in force for a period of one year only from the date of issue, but shall, on application made in this behalf, be renewed from year to year, if -

Provided that an application for renewal of the certificate which does not reach the issuing authority before the certificate ceases to remain in force shall be entertained if the applicant has submitted an application within twelve months from the date the certificate cases to remain in force and has paid an additional fee of the prescribed amount not exceeding fifteen Taka by way of penalty.

⁸⁵(6A) The Chief Controller shall, if he refuses a certificate or the renewal of a certificate under this section, communicate his decision in writing to the applicant for such certificate or renewal within three months from the date of the application.

(7) Where it is found that an insurance surveyor being an individual is, or being a company or firm contains a director or partner who is, suffering from any of the disqualifications mentioned in sub-section (4) of section 42, without prejudice to any other penalty to which he may be liable, the Chief Controller shall, and where it is proved to the satisfaction of the Chief Controller that the insurance surveyor has-

the Chief Controller may cancel the certificate or certificates held by that insurance surveyor:

Provided that in the event of cancellation of a certificate under the discretionary powers of the Chief Controller under this sub-section the Government may, upon an application made to it in this behalf, call for a report from the Chief Controller, and, after considering such report and hearing the applicant, give such direction to the Chief Controller as it may deem fit.

(8) The authority which issued any certificate under this section may issue a duplicate certificate to replace a certificate lost, destroyed or mutilated on payment of the prescribed fee, which shall not be more than five Taka.

(9) Any person who acts in contravention of this section shall be punishable with fine which may extend to one thousand Taka and where the person contravening is a company or a firm, then, without prejudice to any other proceedings which may be taken against the company or firm, every director, manager, secretary or any other officer of the company and every partner of the firm who is knowingly a party to such contravention shall be punishable with fine which may extend to one thousand Taka.

Section 44B. Second survey

(1) If in any case the Chief Controller of Insurance has reason to believe that an insurance surveyor has given a false report or has grossly over-assessed or under-assessed a loss or has made an adjustment of loss in a grossly unjust manner, he may direct the insurer to arrange for another survey of that loss through any other surveyor or surveyors approved by him.

(2) In the event of the second survey made under sub-section (1) the surveyor or surveyors shall forward one copy of the report to the Chief Controller who on considering such report and after giving an opportunity to the first surveyor to be heard, may cancel the certificate of the surveyor concerned in accordance with the provisions of sub-section (7) of section 44A.]

Section 45. Policy not to be called in question on ground of mis-statement after two years

No policy of life insurance effected before the commencement of this Act shall after the expiry of two years from the date of commencement of this Act and no policy of life insurance effected after the coming into force of this Act shall, after the expiry of two years from the date on which it was effected, be called in question by an insurer on the ground that a statement made in the proposal for insurance or in any report of a medical officer, or referee, or friend of the insured, or in any other document leading to the issue of the policy, was inaccurate or false, unless the insurer shows that such statement was on a material matter or suppressed facts which it was material to disclose and that it was fraudulently made by the policy-holder and that the policy-holder knew at the time of making it that the statement was false or that it suppressed facts which it was material to disclose:

Provided that nothing in this section shall prevent the insurer from calling for proof of age at any time if he is entitled to do so, and no policy shall be deemed to be called in question merely because the terms of the policy are adjusted on subsequent proof that age of the life insured was incorrectly stated in the proposal.

Section 46. Application of Bangladesh law to policies issued in Bangladesh

The holder of a policy of insurance issued by an insurer in respect of insurance business transacted in Bangladesh after the commencement of this Act shall have the right, notwithstanding anything to the contrary contained in the policy or in any agreement relating thereto, to receive payment in Bangladesh, of any sum secured thereby and to sue for any relief in respect of the policy in any Court of competent jurisdiction in Bangladesh; and if the suit is brought in Bangladesh any question of law arising in connection with any such policy shall be determined according to the law in force in Bangladesh:

Provided that nothing in this section shall apply to a policy of marine insurance.

Dispute over claims on life policies of small amount

⁸⁶47A. (1) Any dispute arising under a policy of life insurance assuring a sum not exceeding five thousand Taka (exclusive of any profit or bonus not being a guaranteed profit or bonus) issued by an insurer in respect of insurance business transacted by him in Bangladesh, between the claimant and the insurer who issued the policy or has otherwise assumed the liabilities in respect thereof, may, at the option of the claimant, be referred to the Chief Controller of Insurance for settlement and the Chief Controller may, after hearing the parties and taking such evidence as he may, in his absolute discretion, consider necessary, settle the dispute.

(2) The decision of the Chief Controller under this section shall be final and shall not be called in question in any Court and shall be deemed to be a decree of a Court which would have been competent to decide the dispute and be executed accordingly.

(3) The Chief Controller shall, in respect of the duties performed by him for the purpose of this section, charge and collect such fees whether by way of percentage or otherwise as may be prescribed.

Interest on late settlement of claims

⁸⁷47B. (1) Where payment on a policy issued by an insurer becomes due and the person entitled thereto has complied with all the requirements, including the filing of complete papers, for claiming the payment, the insurer shall, if he fails to make the payment within a period of ninety days from the date on which the payment becomes due or the claimant complies with the requirements, whichever is later, pay interest as specified in sub-section (2) on the amount so payable unless he proves that such failure was due to circumstances beyond his control.

(2) The interest under sub-section (1) shall be payable for the period during which the failure continues and shall be calculated at monthly rates at the rate of five per cent higher than the prevailing bank rate.

Section 47. Payment of money into Court

(1) Where in respect of any policy of life insurance maturing for payment an insurer is of opinion that by reason of conflicting claims to or insufficiency of proof of title to the amount secured thereby or for any other adequate reason it is impossible otherwise for the insurer to obtain a satisfactory discharge for the payment of such amount, the insurer may, before the expiry of nine months from the date of the maturing of the policy or, where the circumstances are such that the insurer cannot be immediately aware of such maturing, from the date on which notice of such maturing is given to the insurer, apply to pay the amount into the Court within the jurisdiction of which is situated the place at which such amount is payable under the terms of the policy or otherwise.

(2) A receipt granted by the Court for any such payment shall be a satisfactory discharge to the insurer for the payment of such amount.

(3) An application for permission to make a payment into Court under this section shall be made by a petition verified by an affidavit signed by a principal officer of the insurer setting forth the following particulars, namely:-

(4) An application under this section shall not be entertained by the Court if the application is made before the expiry of six months from the maturing of the policy by survival, or from the date of receipt of notice by the insurer of the death of the insured, as the case may be.

(5) If it appears to the Court that a satisfactory discharge for the payment of the amount cannot otherwise be obtained by the insurer it shall allow the amount to be paid into Court and shall invest the amount in Government securities pending its disposal.

(6) The insurer shall transmit to the Court every notice of claim received after the making of the application under sub-section (3), and any payment required by the Court as a costs of the proceedings or otherwise in connection with the disposal of the amount paid into Court shall as to the costs of the application under sub-section (3) be borne by the insurer and as to any other costs be in the discretion of the Court.

(7) The Court shall cause notice to be given to every ascertained claimant of the fact that the amount has been paid into Court, and shall cause notice at the cost of any claimant applying to withdraw the amount to be given to every other ascertained claimant.

(8) The Court shall decide all questions relating to the disposal of claims to the amount paid into Court.

Section 47C. Dispute over motor insurance claim

(1) Where any dispute arises under a policy insuring a motor vehicle or covering any liability of its owner arising out of the use of the vehicle, any party to the dispute may make an application for adjudication to the Claims Settlement Board constituted under sub-section (2).

(2) The Government shall for the purpose of adjudication of disputes referred to in sub-section (1) constitute a Claims Settlement Board consisting of such number of members, including a Chairman, as it may think fit.

(3) The Chairman and a member shall be appointed on such terms and conditions as the Government may determine and shall hold office for a term of three years and be eligible, on the expiry of his term, for re-appointment for a further like term or terms.

(4) Where a vacancy occurs in the office of a member during his term, the Government shall appoint another person to fill such vacancy and the person so appointed shall hold office for the un-expired period of the term of his predecessor.

(5) In this section and in sections 47D, 47E, 47F, 47G, 47H, 47I, 47J, 47K and 47L, unless the context otherwise requires,-

Section 47D. Qualifications of Chairman, etc.

(1) The Chairman shall be a person who is, or has been, a District Judge, or is or has been, or is qualified to be, a judge of the ⁸⁸the Supreme Court.

(2) No person shall be appointed, or shall continue to be, a member of the Board if he is an undischarged insolvent, or is convicted of an offence which, in the opinion of the Government, involves moral turpitude.

Section 47E. Resignation and removal

(1) A member may, at any time before the expiry of his term, by letter addressed to the Government, resign his office.

(2) The Government may, by order in writing, remove any member if he-

Section 47F. Benches of the Board

(1) The Chairman may, and, if so required by the Government, shall, constitute such number of benches of the Board as may be necessary for the expeditious disposal of the applications; and each such bench shall consist of not less than two members.

(2) A bench shall try such applications as the Chairman may refer to it and shall hold its sittings at such place or places as he may direct.

Section 47G. Fees for application

No application shall be received by the Board unless the application has paid such fee not exceeding one per cent of the amount of the claim in dispute and in such manner as may be prescribed.

Section 47I. Appeal

(1) Except as provided in sub-section (2), the decision of the Board on an application shall be final and shall not be questioned in any Court or before any other authority.

(2) Any party aggrieved by a decision of the Board may, if the amount of the claim in dispute is not less than twenty thousand Taka, prefer an appeal to the High Court Division within a period of thirty days from the date of such decision.

Section 47J. Recovery of the claim as decided

Where an insurer fails to pay the amount of any claim in accordance with the decision on an application within a period of thirty days from the date of the decision, the decision shall be deemed to be a decree of a Court which would have been competent to decide the dispute and be executed accordingly.

Section 47K. Notice to and hearing of insurance companies

When application is made to the Board for the adjudication of a dispute, the Board shall, unless the insurer has himself made the application or has been made a party thereto, send to the insurer a copy of the application together with intimation of the date fixed for the hearing thereof and shall give him an opportunity of being heard.

Restriction on becoming directors of insurers

^{89 90}48B. Notwithstanding anything contained in any other law for the time being in force, a director of an insurer shall not be a director of another insurer registered for the same class of insurance business.

Directors of insurers being public subscribers

48BB. Where the insurer is a company incorporated under the Companies Act, 1913 (VII of 1913), not less than one-third of the total member of directors of the company, shall, notwithstanding anything to the contrary in the Articles of Association of the company, be elected, in the prescribed manner, by the shareholders who are public subscribers to the paid up capital or the company from amongst themselves.

Restriction on appointment of nominated director

48BBB. Notwithstanding anything contained in any other law for the time being in force or in the Articles of Association of any insurer, no person other than a member of the Board of Directors of an insurer shall act as a director:

Provided that where a director is absent from Bangladesh for a period exceeding three months, a person qualified to be a director may be nominated by him to act as director in his place with the prior intimation to the Chief Controller of Insurance.

Chairman and Vice-Chairman

48BBBB. Notwithstanding anything contained in the Articles of Association of an insurer, the Chairman or Vice-Chairman of the Board of Directors of an insurer shall be elected from amongst the directors.]

Section 47H. Procedure and Powers of the Board

(1) The Board shall, for the purpose of the trial of an application, follow such procedure as may be prescribed, and have the same powers as are vested in a civil Court trying a suit under the Code of Civil Procedure, 1908 (Act V of 1908), in respect of-

(2) If, in the course of the trial of an application, any one of the members ceases to hold office, or is, for any reason, unable to attend the sittings of the Board, the trial shall continue before, and the decision may be given by, the remaining members.

(3) If upon any matter requiring the decision of the Board there is a difference of opinion amongst its members, the opinion of the majority shall prevail and the decision of the Board shall be expressed in terms of the view of the majority:

Provided that where the members are equally divided on any point it shall,-

(4) The decision of the Board shall be given in writing and shall be signed,-

(5) The Board shall give a copy of the decision to each party to the dispute and shall also forward a copy to the Chief Controller of Insurance.

(6) The board shall, upon an application made in this behalf by any party to a dispute adjudicated by it and on payment of such fee not exceeding one Taka for every one hundred words, and subject to such conditions, as may be prescribed, furnish certified copies of its proceedings or of any document submitted to or produced before it.

Section 47L. Other Jurisdiction of Board

The Government may, by notification in the official Gazette, authorise the Board-

and thereupon the provisions of sections 47C to 47K shall apply to such inquiry and to such class of disputes as they apply to a dispute arising under a policy insuring a motor vehicle.]

Section 48. Directors of insurers being companies

(1) Where the insurer is a company incorporated under the Companies Act, 1913, or under the Indian Companies Act, 1882, or under the Indian Companies Act, 1866, or under any Act repealed thereby, and carries on the business of life insurance, not less than one-third of the directors of the company shall notwithstanding anything to the contrary in the Articles of Association of the company be elected in the prescribed manner by the holders of policies of life insurance issued by the company.

⁹¹(1A) Where in the case of an insurer the number of directors required to be elected under sub-section (1) was, immediately before the commencement of the Insurance (Amendment) Ordinance, 1970, less than one-third of the directors, such insurer shall take such steps as may be necessary for complying with the provisions of sub-section (1) within a period of one year from such commencement; and no proceedings of the directors shall, during that period, be invalid or be questioned merely on the ground of non-compliance with those provisions.

(2) Only and all persons holding otherwise than as assignees policies of life insurance issued by the company of such minimum amount and having been in force for such minimum period as may be prescribed shall unless disqualified under sub-section (2A) be eligible for election as directors under sub-section (1), and only and all persons holding policies of life insurance issued by the company and having been in force at the time of the election for not less than six months shall be eligible to vote at such elections:

Provided that the assignment of a policy to the person who took out the policy shall not disqualify that person for being eligible for election as a director under sub-section (1).

⁹²(2A) A person shall be ineligible for election as a director under sub-section (1) of any company if he is a director, officer, employee, or legal or technical adviser of that company, or of any other insurer, and shall cease to be a director under sub-section (1) if after election he acquires any disqualification specified in this sub-section or no longer holds the qualifications required by sub-section (2):

Provided that nothing in this sub-section shall disqualify a person who is an elected director under sub-section (1) and is not otherwise disqualified under this sub-section, from being re-elected.

(3) The Government may, for such period, or to such extent and subject to such conditions as may be specified by it in this behalf, exempt from the operation of this section-

(4) This section shall not take effect, in respect of any company in existence at the commencement of this Act, until the expiry of one year therefrom, and in respect of any company incorporated after the commencement of this Act, until the expiry of two years from the date of registration to carry on life insurance business.

Restriction on the life insurance agents’ becoming directors of Life Insurance Companies

⁹³48A. (1) No Insurance agent who solicits or procures life insurance business, and no employer of agents who procures life insurance business, shall be eligible to be or remain a director of any insurance company carrying on life insurance business unless he suspends such solicitation or procurement.

(2) Any insurance agent or employer of agents who contravenes the provisions of sub-section (1) shall cease to be a director and shall also be liable to the cancellation of his licence as insurance agent or, as the case may be, certificate as employer of agents.

Appointment of Chief Executives of insurers

⁹⁴48C. (1) No insurer shall carry on any insurance business without having appointed a chief executive officer for that purpose.

(2) No person shall be appointed as the chief executive officer of an insurer without the prior permission of the Chief Controller of Insurance and he shall not accord permission for such appointment unless the person proposed to be appointed has prescribed qualification and experience in the field of insurance.

(3) The chief executive officer shall not be removed, terminated or dismissed by the insurer without the prior approval of the Chief Controller of Insurance and he shall not give decision in such cases without hearing the concerned chief executive officer and the insurer or any person authorised by the insurer in this behalf.

Advisers of insurers

⁹⁵48CC. Notwithstanding anything contained in the Articles of Association of an insurer, no insurer shall appoint more than three advisers:

Provided that no share-holder or director of the concerned insurer or member of their families shall be an adviser under this section.

Section 49. Restriction on dividends and bonuses

(1) No insurer, being an insurer specified in sub-clause (a) (ii) or sub-clause (b) of clause (9) of section 2, who carries on the business of life insurance or any other class or sub-class of insurance business to which section 13 applies shall for the purpose of declaring or paying any dividend to shareholders or any bonus to policy-holders or of making any payment in service of any debentures, utilise directly or indirectly any portion of the life insurance fund or of the fund of such other class or sub-class of insurance business, as the case may be, except a surplus shown in the valuation balance-sheet in Form I as set forth in the Fourth Schedule submitted to the Chief Controller of Insurance as part of the abstract referred to in section 15 as a result of an actuarial valuation of the assets and liabilities of the insurer; nor shall he increase such surplus by contributions out of any reserve fund or otherwise unless such contributions have been brought in as revenue through the revenue account applicable to that class or sub-class of insurance business on or before the date of the valuation aforesaid, when the reserve fund is made up solely of transfers from similar surpluses disclosed by valuations in respect of which returns have been submitted to the Chief Controller of Insurance under section 15 of this Act ⁹⁶* * *:

Provided that payments made out of any such surplus in service of any debentures shall not exceed fifty per cent of such surplus including any payment by way of interest on the debentures, and interest paid on the debentures shall not exceed ten per cent of any such surplus except when the interest paid on the debentures is off-set against the interest credited to the fund or funds concerned in deciding the interest basis adopted in the valuation disclosing the aforesaid surplus.

(2) No insurer other than an insurer specified in sub-clause (a)(ii) or sub-clause (b) of clause (9) of section 2 who carries on the business of life insurance in Bangladesh shall for the purpose of declaring or paying any bonus to policy-holders in Bangladesh utilise directly or indirectly any portion of the life insurance fund except a surplus shown in the valuation balance-sheet in Form I as set forth in the Fourth Schedule submitted to the Chief Controller of Insurance as part of the abstract referred to in section 15 as a result of an actuarial valuation of the assets and liabilities of the insurer in Bangladesh; nor shall he increase such surplus by contributions out of any reserve fund or otherwise unless such contributions have been brought in as revenue through the revenue account applicable to life insurance business on or before the date of the valuation aforesaid, except when the reserve fund is made up solely of transfers from similar surpluses disclosed by valuations in respect of which returns have been submitted to the Chief Controller of Insurance under section 15 of this Act ⁹⁷* * *.

Distribution of profits on life insurance business among policy-holders

⁹⁸49A. Notwithstanding anything contained to the contrary in its Memorandum or Articles of Association or any other documents, no insurer transacting life insurance business shall after the commencement of the Insurance (Amendment) Ordinance, 1970, allocate for the benefit of the policy-holders a sum less than such percentage of the surplus, being not less than ⁹⁹ninety per cent or more than ninety-seven and one-half per cent, as may be prescribed:

Provided that in prescribing the percentage regard shall be had to the size of the insurer.

Explanation.- In this section, “Surplus” means the sum shown as surplus in Form I of the Fourth Schedule enhanced by any sum transferred to any reserve other than a reserve for depreciation in investment adjusted by an amount representing surplus disclosed at a previous valuation and already allocated.

Section 50. Notice of options available to the assured on the lapsing of a policy

An insurer shall, before the expiry of three months from the date on which the premiums in respect of a policy of life insurance were payable but not paid, give notice to the policy-holder informing him of the options available to him unless these are set forth in the policy.

Special provision in respect of certain life insurance policies

¹⁰⁰50A. (1) If, in respect of a policy of life insurance under which the whole of the benefits become payable either on, or at a fixed interval or intervals after, the occurrence of a contingency which is bound to occur, all the premiums have been paid for at least two consecutive years and the policy-holder does not, or is unable to, pay further premiums, any one of the following consequences according as the policy-holder has indicated his option in writing, shall ensue, namely:-

(2) The option under sub-section (1) may be indicated by the policy-holder either at the time of taking the policy or at any time thereafter before the cessation of the payment of premium; and any option so indicated may be modified at any time before such cessation.

Section 51. Supply of copies of proposals and medical reports

Every insurer shall, on application by a policy-holder and on payment of a fee not exceeding one Taka, supply to the policy-holder certified copies of the questions put to him and his answers thereto contained in his proposal for insurance and in the medical report supplied in connection therewith.

Section 52D. Cancellation of contracts and agreements

The Administrator may, at any time during the continuance of his appointment with respect to any insurer and after giving an opportunity to the persons concerned to be heard, cancel or vary (either unconditionally or subject to such conditions as he thinks fit to impose) any contract or agreement (other than a policy) between the insurer and any other person which the Administrator is satisfied is prejudicial to the interests of holders of insurance policies.

Section 52E. Termination of appointment of Administrator

If at any time, on a report made by the Chief Controller in this behalf, it appears to the Government that the purpose of the order appointing the Administrator has been fulfilled or that for any reason it is undesirable that the order of appointment should remain in force, the Government may cancel the order and thereupon the Administrator shall be divested of the management of the insurance business which shall, unless otherwise directed by the Government again vest in the person in whom it was vested immediately prior to the date of appointment of the Administrator.

Section 52F. Finality of decision of appointing Administrator

Any order or decision of the Government made in pursuance of section 52A or section 52E shall be final and shall not be called in question in any Court.

Section 52G. Penalty for withholding document or property from Administrator

If any director or officer of the insurer or any other person fails to deliver to the Administrator any books of account, registers or any other documents in his custody relating to the business of the insurer the management of which has vested in the Administrator, or retains any property of such insurer, he shall be punishable with imprisonment which may extend to six months, or with fine which may extend to one thousand Taka or with both.

Section 52H. Protection of action taken under sections 52A to 52D

(1) No suit, prosecution or other legal proceeding shall lie against an Administrator for anything which is in good faith done or intended to be done in pursuance of section 52A, section 52B, section 52C or section 52D.

(2) No suit or other legal proceeding shall lie against the Government or the Chief Controller for any damage caused or likely to be caused by anything which is in good faith done or intended to be done under section 52A, section 52B or section 52E.]

Section 52. Prohibition of business on dividing principle

(1) No insurer shall after the commencement of this Act, begin, or after three years from that date continue to carry on, any business upon the dividing principle, that is to say, on the principle that the benefit secured by a policy is not fixed but depends either wholly or partly on the results of a distribution of certain sums amongst policies becoming claims within certain time-limits, or on the principle that the premiums payable by a policy-holder depend wholly or partly on the number of policies becoming claims within certain time-limits:

Provided that nothing in this section shall be deemed to prevent an insurer from allocating bonuses to holders of policies of life insurance as a result of a periodical actuarial valuation either as reversionary additions to the sums insured or as immediate cash bonuses or otherwise:

Provided further that an insurer who continues to carry on insurance business on the dividing principle after the commencement of this Act shall withhold from distribution a sum of not less than forty per cent of the premiums received during each year after the commencement of this Act, in which such business is continued so as to make up the amount required for investment under section 27.

(2) and (3) ¹⁰¹Omitted by section 43 of the Insurance (Amendment) Act, 1958 (Act No. XXVII of 1958).

Section 52A. When Administrator for management of insurance business may be appointed

(1) If at any time the Chief Controller has reason to believe that an insurer carrying on insurance business is acting in a manner likely to be prejudicial to the interest of holders of insurance policies, he may, after giving such opportunity to the insurer to be heard as he thinks fit, make a report thereon to the Government.

(2) The Government, if it is of opinion after considering the report that it is necessary or proper to do so, may appoint an Administrator to manage the affairs of the insurer under the direction and control of the Chief Controller.

(3) The Administrator shall receive such remuneration as the Government may direct and the Government may at any time cancel the appointment and appoint some other person as Administrator.

(4) The management of the business of the insurer shall as on and after the date of appointment of the Administrator vest in such Administrator but except with the leave of the Chief Controller the Administrator shall not issue any further policies.

(5) As on and after the date of appointment of the Administrator any person vested with any such management immediately prior to that date shall be divested of that management.

(6) The Chief Controller may issue such directions to the Administrator as to his powers and duties as he deems desirable in the circumstances of the case, and the Administrator may apply to the Chief Controller at any time for instructions as to the manner in which he shall conduct the management of the business of the insurer or in relation to any matter arising in the course of such management.

Section 52B. Powers and duties of the Administrator

(1) The Administrator shall conduct the management of the business of the insurer with the greatest economy compatible with efficiency and shall, as soon as may be possible, file with the Chief Controller a report stating which of the following courses is in the circumstances most advantageous to the general interest of the holders of insurance policies, namely:-

(2) On the filing of the report with the Chief Controller, the Chief Controller may take such action as he thinks fit for promoting the interest of the holders of insurance policies in general.

(3) Any order passed by the Chief Controller under sub-section (2) shall be binding on all persons concerned, and shall have effect notwithstanding anything in the Memorandum or Articles of Association of the insurer, if a company.

Section 52C. Powers of Administrator respecting property liable to attachment under section 106

(1) If the Administrator is satisfied that any person has rendered himself liable to be proceeded against under section 106, he may, pending the institution of proceedings against such person under that section, by order in writing prohibit him or any other person from transferring or otherwise disposing of any property which, in the opinion of the Administrator, would be liable to attachment in proceedings under that section.

(2) Any person aggrieved by an order made by the Administrator under sub-section (1) may, within fourteen days from the date on which the order is served on him, appeal against such order to the Government and the Government may pass such order thereon as it thinks fit.

(3) An order made by the Administrator under sub-section (1) shall, subject to any order made by the Government on appeal, be in force for a period of three months from the date of the order, unless, before the expiry of the said period, an application is made under sub-section (1) of section 106 to the Court competent to exercise jurisdiction under that sub-section, and when such an application is made, the order shall, subject to any order made by that Court, continue in force as if it were an order of attachment made by that Court in proceedings under that section.

(4) An order made by the Administrator under this section shall,-

(5) If any question arises whether a person was duly served with an order under sub-section (4) the publication of the order in the official Gazette shall be conclusive proof that the order was so served, and a failure to comply with the provisions of clause (a) or clause (b) of sub-section (4) shall not affect the validity of the order.

(6) Notwithstanding anything contained in this section, any property in respect of which an order has been made by the Administrator may, with the previous permission of the Administrator and subject to such terms and conditions as he may impose, be transferred or otherwise disposed of.

(7) Notwithstanding anything contained in any other law for the time being in force, the transfer or other disposition of any property in contravention of any order made by the Administrator under this section or of any terms and conditions imposed by him shall be void.

(8) For the purpose of enabling him to form an opinion as to whether any property would be liable to attachment in proceedings under section 106 or for the purpose of enabling him to institute proceedings under that section, the Administrator may require any person to furnish information on such points or matters as, in the opinion of the Administrator may be relevant for the purpose, and any person so required shall be deemed to be legally bound to furnish such information within the meaning of section 176 of the ¹⁰²Penal Code.

(9) The Administrator shall have all the powers of a civil Court under the Code of Civil Procedure, 1908, while trying a suit in respect of the following matters, namely:-

and any proceeding before the Administrator under this section shall be deemed to be a judicial proceeding within the meaning of sections 193 and 228 of the ¹⁰³Penal Code.

(10) Save as provided in this section or in section 106, and notwithstanding anything contained in any other law for the time being in force,-

Unpaid-up share capital

¹⁰⁴53A. Notwithstanding anything contained in any other law, in ascertaining for any purpose of this Act the solvency or otherwise of any insurer, no account shall be taken of any assets of the insurer consisting of unpaid-up share capital.

Section 53. Winding up by the Court

(1) The Court may order the winding up in accordance with the Companies Act, 1913, of any insurance company and the provisions of that Act shall, subject to the provisions of this Act apply accordingly.

(2) In addition to the grounds on which such an order may be based, the Court may order the winding up of an insurance company-

Section 54. Voluntary winding up

Notwithstanding anything contained in the Companies Act, 1913, an insurance company shall not be wound up voluntarily except for the purpose of effecting an amalgamation or a re-construction of the company, or on the ground that by reason of its liabilities it cannot continue its business.

Section 55. Valuation of liabilities

(1) In the winding up of an insurance company or in the insolvency of any other insurer the value of the assets and the liabilities of the insurer shall be ascertained in such manner and upon such basis as the liquidator or receiver in insolvency thinks fit, subject, so far as applicable, to the rule contained in the Sixth Schedule and to any directions which may be given by the Court.

(2) For the purposes of any reduction by the Court of the amount of the contracts of any insurance company the value of the assets and liabilities of the company and all claims in respect of policies issued by it shall be ascertained in such manner and upon such basis as the Court thinks proper having regard to the rule aforesaid.

(3) The rule in the Sixth Schedule shall be of the same force and may be repealed, altered or amended as if it were a rule made in pursuance of section 11138)and rules may be made under that section for the purpose of carrying into effect the provisions of this Act with respect to the winding up of insurance companies.

Section 56. Application of surplus assets of life insurance fund in liquidation or insolvency

(1) In the winding up of an insurance company and in the insolvency of any other insurer the value of the assets and the liabilities of the insurer in respect of life insurance business shall be ascertained separately from the value of any other assets or any other liabilities of the insurer and no such assets shall be applied to the discharge of any liabilities other than those in respect of life insurance business except in so far as those assets exceed the liabilities in respect of life insurance business.

(2) In the winding up of an insurance company carrying on the business of life insurance or in the insolvency of any other insurer carrying on such business where any proportion of the profits of the insurer was before the commencement of the winding up or insolvency allocated to policy-holders, if, when the assets and liabilities of the insurer have been ascertained, there is found to be a surplus of assets over liabilities (hereinafter referred to as a prima facie surplus) there shall be added to the liabilities of the insurer in respect of the life insurance business an amount equal to such proportion of the prima facie surplus as is equivalent to such proportion of the profits allocated to shareholders and policy-holders as was allocated to policy-holders during the ten years immediately preceding the commencement of the winding up and the assets of the insurer shall be deemed to exceed his liabilities only in so far as those assets exceed those liabilities after such addition:

Provided that-

Section 57. Winding up secondary companies

(1) Where the insurance business or any part of the insurance business of an insurance company has been transferred to another insurance company under an arrangement in pursuance of which the first mentioned company (in this section referred to as the secondary company) or the creditors thereof has or have claims against the company to which such transfer was made (in this section referred to as the principal company then, if the principal company is being wound up by or under the supervision of the Court, the Court shall (subject as hereinafter mentioned) order the secondary company to be wound up in conjunction with the principal company and may by the same or any subsequent order appoint the same person to be liquidator for the two companies and make provision for such other matters as may seem to the Court necessary with a view to the companies being wound up as if they were one company.

(2) The commencement of the winding up of the principal company shall, save as otherwise ordered by the Court, be the commencement of the winding up of the secondary company.

(3) In adjusting the rights and liabilities of the members of the several companies among themselves the Court shall have regard to the constitution of the companies and to the arrangements entered into between the companies in the same manner as the Court has regard to the rights and liabilities of different classes of contributories in the case of the winding up of a single company or as near thereto as circumstances admit.

(4) Where any company alleged to be secondary is not in process of being wound up at the same time as the principal company to which it is alleged to be secondary, the Court shall not direct the secondary company to be wound up, unless, after hearing all objections (if any) that may be urged by or on behalf of the company against its being wound up, the Court is of opinion that the company is secondary to the principal company and that the winding up of the company in conjunction with the principal company is just and equitable.

(5) An application may be made in relation to the winding up of any secondary company in conjunction with the principal company by any creditor of, or person interested in, the principal or secondary company.

(6) Where a company stands in the relation of a principal company to one insurance company and in the relation of a secondary company to some other insurance company or where there are several insurance companies standing in the relation of secondary companies to one principal company, the Court may deal with any number of such companies together or in separate groups as it thinks most expedient upon the principles laid down in this section.

Section 58. Schemes for partial winding up of insurance companies

(1) If at any time it appears expedient that the affairs of an insurance company in respect of any class of business comprised in the undertaking of the company should be wound up but that any other class of business comprised in the undertaking should continue to be carried on by the company or be transferred to another insurer, a scheme for such purposes may be prepared and submitted for confirmation of the Court in accordance with the provisions of this Act.

(2) Any scheme prepared under this section shall provide for the allocation and distribution of the assets and liabilities of the company between any classes of business affected (including the allocation of any surplus assets which may arise on the proposed winding up), for any future rights of every class of policy-holders in respect of their policies and for the manner of winding up any of the affairs of the company which are proposed to be wound up and may contain provisions for altering the memorandum of the company with respect to its objects and such further provisions as may be expedient for giving effect to the scheme.

(3) The provisions of this Act relating to the valuation of liabilities of insurers in liquidation and insolvency and to the application of surplus assets of the life insurance fund in liquidation or insolvency shall apply to the winding up of any part of the affairs of a company in accordance with the scheme under this section in like manner as they apply in the winding up of an insurance company, and any scheme under this section may apply with the necessary modifications to any of the provisions of the Companies Act, 1913, relating to the winding up of companies.

(4) An order of the Court confirming a scheme under this section whereby the memorandum of a company is altered with respect to its objects shall as respects the alteration have effect as if it were an order confirmed under section 12 of the Companies Act, 1913, and the provisions of sections 15 and 16 of that Act shall apply accordingly.

(5) When making an order confirming a scheme under this section, the Court may make such orders as it considers necessary for the disposal of so much of the deposit made by the company under section 7 or section 98 as does not relate to the classes of insurance business, if any, which the company continues to carry on.

Section 59. Return of deposits

In the winding up of an insurance company (otherwise than in a case to which section 58 applies) and in the insolvency of any other insurer, the liquidator or assignee, as the case may be, shall apply to the Court for an order for the return of the deposit made by the company or the insurer, as the case may be, under section 7 or section 98 and the Court shall, on such application, order a return of the deposit subject to such terms and conditions as it shall direct.

Section 60. Notice of policy values

In the winding up of an insurance company for the purposes of a cash distribution of the assets and in the insolvency of any other insurer the liquidator or assignee, as the case may be, in the case of all persons appearing by the books of the company or other insurer to be entitled to or interested in the policies granted by the company or other insurer shall ascertain the value of the liability of the company or other insurer to each such person and shall give notice of such value to those persons in such manner as the Court may direct and any person to whom notice is so given shall be bound by the value so ascertained unless he gives notice of his intention to dispute such value in such manner and within such time as may be specified by a rule or order of the Court.

Section 61. Power of Court to reduce contracts of insurance

(1) Where an insurance company is in liquidation or any other insurer is insolvent the Court may make an order reducing the amount of the insurance contracts of the company or other insurer upon such terms and subject to such conditions as the Court thinks just.

(2) Where a company carrying on the business of the life insurance has been proved to be insolvent, the Court may, if it thinks fit in place of making a winding up order reduce the amount of the insurance contracts of the company upon such terms and subject to such conditions as the Court thinks fit.

(3) Application for an order under this section may be made either by the liquidator or by or on behalf of the company or by a policy-holder, or by the Chief Controller of Insurance and the Chief Controller of Insurance and any person whom the Court thinks likely to be affected shall be entitled to be heard on any such application.

Section 62. Power of Government to impose reciprocal disabilities on non-Bangladesh companies

Where, by the law or practice of any country outside Bangladesh in which an insurer carrying on insurance business in Bangladesh is constituted, incorporated or domiciled, insurance companies incorporated in Bangladesh are required as a condition of carrying on insurance business in that country to comply with any special requirements whether as to the keeping of deposits of assets in that country or otherwise which is not imposed upon insurers of that country under this Act the Government shall, if satisfied of the existence of such special requirement, by notification in the official Gazette, direct that the same requirement, or requirements as similar thereto as may be shall be imposed upon insurers of that country as a condition of carrying on the business of insurance in Bangladesh.

Section 63. Particulars to be filed by insurers established outside Bangladesh

Every insurer, having his principal place of business or domicile outside Bangladesh, who establishes a place of business within Bangladesh, or appoints a representative in Bangladesh with the object of obtaining insurance business, shall within three months from the establishment of such place of business or the appointment of such representative, file with the Chief Controller of Insurance-

Section 64. Books to be kept by insurers established outside Bangladesh

Every insurer having his principal place of business or domicile outside Bangladesh shall manage its affairs in Bangladesh at his principal office in Bangladesh and shall keep thereat all the records relating to the business of the insurer in Bangladesh including such books of account, registers and documents as will enable him to furnish the accounts, statements and abstracts which he is required under this Act to furnish to the Chief Controller of Insurance in respect of the insurance business transacted by him in Bangladesh.

Section 65. Definition of “provident society”

(1) In this Part “provident society” means, a person who, or a body of persons (whether corporate or un-incorporate) which, not being an insurer registered for the time being under Part II of this Act, carries on the business of insuring the payment, on the happening of any of the contingencies mentioned in sub-section (2), of-

exclusively in both cases (a) and (b) of any profit or bonus not being a guaranteed profit or bonus.

Explanation.- For the purposes of this sub-section a period is “certain” if its duration is ascertainable in advance and “uncertain” if its duration is not so ascertainable.

(2) The contingencies referred to in sub-section (1) are the following, namely:-

(3) For the purposes of sub-sections (1) and (2)-

(4) Every person or body of persons for the time being registered as a provident society under the Provident Insurance Societies Act, 1912, and every person or body of persons for the time being registered as a provident society under this Act, shall be deemed to be a provident society for all the purposes of this Act.

(5) If any question arises whether any person or body of persons is or is not a provident society within the meaning of this section, the Chief Controller of Insurance shall decide the question and his decision shall be final.

Section 66. Restrictions on provident societies

No provident society shall undertake any form of insurance not falling within the limits fixed by sub-section (1) of section 65, nor shall any provident society be eligible to be registered under section 3.

Section 67. Name

No provident society established after the commencement of this Act, shall adopt as its name, and no provident society established before the commencement of this Act shall continue after the expiry of six months from the commencement thereof to use as its name, any combination of words which fails to include the word “provident” or which includes the word “life”.

Section 68. Insurable interest

No provident society shall receive any premium or contribution for insuring money to be paid to any person other than the person paying such premium or contribution or the wife, husband, child, grand-child, parent, brother or sister, nephew or niece of such a person.

Section 69. Dividing business

(1) No provident society shall carry on any business upon the dividing principle, that is to say, on the principle that the benefit secured by a policy is not fixed but depends either wholly or partly on the results of a distribution of certain sums amongst policies becoming claims within certain time-limits, or on the principle that the premiums payable by a policy holder depend wholly or partly on the number of policies becoming claims within certain time-limits.

(2) The Chief Controller of Insurance shall, as soon as possible, take steps to have any provident society which carries on business on the dividing principle wound up:

Provided that, where any such provident society in existence at the commencement of this Act applies within three months of such commencement to the Chief Controller of Insurance for permission to continue carrying on its business with a view meanwhile to reorganise its business in accordance with the provisions of this Act, the Chief Controller of Insurance may at his discretion, with due regard to the past history of the society, permit the society to continue business for a period not exceeding two years from the date of receipt of such permission, so however that no new business on the dividing principle is undertaken by the society.

(3) Where after the commencement of the Insurance (Amendment) Act, 1941, a provident society is to be wound up in pursuance of this section, or where, whether before or after the commencement of that Act, a provident society ceases to carry on business on the dividing principle, the provisions of sub-section (2) and sub-section (3) of section 52 shall, so far as may be, apply in like manner as they apply to an insurer ceasing to carry on business on the dividing principle.

Section 70. Registration

(1) No provident society except a provident society registered under the provisions of the Provident Insurance Societies Act, 1912, shall receive any premium or contribution until it has obtained from the Chief Controller of Insurance a certificate of registration.

(2) Every application for registration shall be accompanied by-

(3) The Chief Controller of Insurance may refuse to issue a certificate of registration until he is satisfied that the rules of the society comply with the provisions of this Act and that the Society complies with the provisions of sections 67,71,72,73 and 73A , but if he is so satisfied he shall register the society and its rules.

¹⁰⁶(3A) The Chief Controller of Insurance shall, if he refuses a certificate of registration, communicate his decision in writing to the applicant for such registration within three months from the date of the application.

(4) The Chief Controller of Insurance may, after giving previous notice in writing in such manner as he thinks fit specifying the grounds for the proposed cancellation, and allowing the society concerned an opportunity of being heard, cancel the registration of the society made under this section or made under the provisions of the Provident Insurance Societies Act, 1912-

Provided that the Chief Controller of Insurance may without such previous notice,-

(5) When a registration is cancelled the provident society shall not, after the cancellation has taken effect, enter into any new contracts of insurance, but all rights and liabilities in respect of contracts of insurance entered into by it before such cancellation takes effect shall, subject to the provisions of section 88, continue as if the cancellation had not taken place.

(6) Where a registration is cancelled under clause (b) of sub-section (4) or clause (c) of the proviso to that sub-section, or because the society has failed to have its registration renewed, the Chief Controller of Insurance may at his discretion revive the registration if the provident society, within six months from the date on which the cancellation took effect, makes the deposits required by section 73 or satisfies the Chief Controller of Insurance that no claim upon it such as is referred to in the said clause (c) remains unpaid or has had an application under sub-section (3) of section 70A accepted, as the case may be, and complies with any directions which may be given to it by the Chief Controller of Insurance.

(7) The Chief Controller of Insurance may, on payment of the prescribed fee which shall not exceed five Taka, issue a duplicate certificate of registration to replace a certificate lost, destroyed or mutilated, or in any other case where he is of opinion that the issue of a duplicate certificate is necessary.

Renewal of registration

¹⁰⁷70A. (1) Every provident society registered under this Act, or under the Provident Insurance Societies Act, 1912, shall have its registration renewed annually for each period of twelve months after that ending on the 30th day of June, 1942.

(2) An application for the renewal of a registration shall be made by the society to the Chief Controller of Insurance before the 30th day of June preceding the period for which renewal is sought, and shall be accompanied as provided in sub-section (3) by evidence of payment of the prescribed fee which shall not exceed two hundred Taka but may vary according to the volume of insurance business done by the society.

(3) The prescribed fee for the renewal of a registration for any year shall be paid into the Bangladesh Bank, or, where there is no office of that Bank, ¹⁰⁸* * * into any Government treasury, and the receipt shall be sent along with the application for renewal of the registration.

(4) If a provident society fails to apply for renewal of registration before the date specified in sub-section (2) the Chief Controller of Insurance may, so long as he has taken no action under section 88 to have the society wound up, accept an application for renewal of registration on receipt from the society of the fee payable with the application and such penalty, not exceeding the prescribed fee payable by the society, as he may require.

(5) The Chief Controller of Insurance shall, on being satisfied that the society has fulfilled the requirements of this section, renew the registration and grant it a certificate of renewal of registration.

(6) The Chief Controller of Insurance shall, if he refuses the renewal of registration, communicate his decision in writing to the application for such renewal within three months from the date of the application.

Section 70B. Supplementary information and reports of alterations in particulars furnished with application for registration

(1) Every provident society registered under section 70 before the commencement of the Insurance (Amendment) Act, 1941, shall, before the expiration of three months from the commencement of the Insurance (Amendment) Act, 1941, furnish to the Chief Controller of Insurance such particulars in addition to those already supplied for the purpose of obtaining registration as are required by sub-section (2) of section 70 of this Act as amended by the Insurance (Amendment) Act, 1941.

(2) [Omitted by section 3 and the Second Schedule of the Bangladesh Laws (Revision And Declaration) Act, 1973 (Act No. VIII of 1973).]

(3) When any alteration occurs or is made which affects any of the matters which are required under the provisions of sub-section (2) of section 70 to accompany an application by a provident society for registration under that section, or are to be furnished to the Chief Controller of Insurance under this section, the provident society shall furnish forthwith to the Chief Controller of Insurance full particulars duly authenticated of such alteration.]

Section 71. Certain provisions of Part II to apply to provident societies

The provisions of sections 20,32,46 and 53A shall apply to provident societies as they apply to insurers, and in such application references to shareholders of an insurer shall be construed as references to members of a provident society:

Provided that a provident society may charge a fee not exceeding one Taka for supplying a copy of any document referred to in sub-section (2) of section 20.

Section 72. Working capital

No provident society shall be registered unless it has a paid-up capital sufficient to provide as working capital a net sum of not less than five thousand Taka exclusive of deposits made under this Act and exclusive in the case of a company of any expenses incurred in connection with the formation of the company.

Section 73. Deposits

(1) Every provident society shall, if established before the commencement of this Act within one year from such commencement, or, if established after the commencement of this Act before the society applies for registration under section 70, deposit and keep deposited with the Bangladesh Bank in one of the offices in Bangladesh of the Bank, for and on behalf of the Government cash or approved securities amounting at the market value of the securities on the date of deposit to five thousand Taka, and shall thereafter make in each calendar year a further deposit amounting to not less than one-fifth of the premium income for the preceding calendar year as shown in the revenue account of the society (including admission fees and other fees received by the society) until the total amount so deposited and kept is fifty thousand Taka.

(2) The provisions of sub-sections (8),(9),(9A),(9B) and (10) of section 7 and of sub-section (1) of section 8 and of section 9 shall apply to the deposits made under this section as they apply to deposits made by an insurer.

Restriction on name of provident society

¹⁰⁹73A. (1) A provident society shall not be registered by a name identical with that by which an insurer or another provident society in existence is already registered, or so nearly resembling that name as to be calculated to deceive, except when the provident society in existence is in the course of being dissolved and signifies its consent, or the insurer in existence signifies his consent, to the Chief Controller of Insurance.

(2) If a provident society, through inadvertence or otherwise, is without such consent as aforesaid registered by a name identical with that by which an insurer or another provident society already in existence is registered, or so nearly resembling it as to be calculated to deceive, the first-mentioned society shall, if called upon to do so by the Chief Controller of Insurance on the application of the insurer or the second-mentioned society, change its name within a time to be fixed by the Chief Controller of Insurance:

Provided that nothing in this section shall apply to any provident society carrying on business before the commencement of the Insurance (Amendment) Act, 1946.

Section 74. Rules

(1) Every provident society shall in its rules set forth-

(2) Where the rules of any provident society registered under the Provident Insurance Societies Act, 1912, fail to comply with the provisions of this section the society shall, before the expiry of twelve months from the commencement of this Act, amend the rules so as to comply with these provisions.

Section 75. Amendment of rules

(1) No amendment of any rule of a provident society shall be valid until it has been sent to the Chief Controller of Insurance and has been registered by him.

(2) The Chief Controller of Insurance on being satisfied that the proposed amendment is not contrary to the provisions of this Act shall, unless he is of opinion that the amendment unfairly affects the rights of existing members or policy-holders of the society, issue to the society an acknowledgment of the registration of the amended rule.

(3) The Chief Controller of Insurance shall, if he refuses registration of any amendment of any rule, communicate his decision in writing to the applicant for such registration within three months from the date of the application.

Section 76. Supply of copy of rules

Every provident society shall on demand deliver free of cost to any member of the society a copy of the rules of the society and to any person other than a member a copy of such rules on the payment of a sum not exceeding one Taka.

Section 77. Registered office

Every provident society shall have in Bangladesh a principal office (on the outside of which it shall keep displayed its name in a conspicuous position in legible characters) to which all communications and notices may be addressed, and shall give notice to the Chief Controller of Insurance of any change in the location thereof within twenty-eight days of its occurrence.

Section 78. Publication of authorised capital to contain also subscribed and paid-up capital

Where any notice, advertisement or other official publication of a provident society contains a statement of the amount of the authorised capital of the society, the publication shall also contain a statement of the amount of the capital which has been subscribed and the amount paid up.

Section 79. Registers and books

Every provident society shall keep at its principal office in Bangladesh-

Section 80. Revenue account, balance-sheet and annual statements

(1) Every provident society shall at the expiry of the calendar year prepare a revenue account and balance-sheet in the prescribed form verified in the prescribed manner, together with a report on the general state of the society's affairs and shall cause the revenue account and balance-sheet to be audited by an auditor, and the auditor shall so far as may be in the audit of a provident society have the powers of, exercise the functions vested in, and discharge the duties and be subject to the liabilities imposed on, an auditor of companies by section 145 of the Companies Act, 1913.

(2) Every provident society shall at the expiry of the calendar year prepare with respect to that year-

(3) [Omitted by section 3 and the Second Schedule of the Bangladesh Laws (Revision And Declaration) Act, 1973 (Act No. VIII of 1973).]

Section 81. Actuarial report and abstract

(1) Every provident society shall once in every five years or at such shorter intervals as may be laid down by the rules of the society cause an investigation to be made as at the last day of a calendar year into its financial condition including the valuation of its liabilities and assets by an actuary. (2) The report of the actuary shall contain an abstract in which shall be stated-

and shall have appended to it a certificate signed by a principal officer of the society that all material necessary for proper valuation has been placed at the disposal of the actuary and that full and accurate particulars of every policy under which there is a liability either actual or contingent have been furnished to the actuary for the purpose of the investigation.

(3) If the actuary finds that the financial condition of the society is such that no surplus exists for distribution as bonus to the policy-holders or as dividend to the shareholders, he shall state in his report whether in his opinion the society is insolvent and, if so, whether it should be wound up or not, and the extent to which in his opinion existing contracts should be modified or existing rates of premium should be adjusted to make good the deficiency in the assets.

Section 82. Submission of returns to Chief Controller of Insurance

(1) The revenue account and balance-sheet with the auditor's report thereon and the report on the general state of the society's affairs referred to in sub-section (1) of section 80, shall be printed and four copies of these and of the statements referred to in sub-section (2) of section 80, shall be furnished as returns to the Chief Controller of Insurance within six months from the end of the period to which they relate.

(2) All the material necessary for the proper valuation of the liabilities of the society under the provisions of section 81 shall be placed at the disposal of the actuary within three months from the end of the period to which such material relates, and the report and abstract referred to in section 81 shall be furnished as a return to the Chief Controller of Insurance within a further period of three months.

(3) The provisions of sub-section (2) of section 15 relating to the copies therein referred to shall apply to the returns referred to in sub-section (1) of this-section, and the provisions of section 17 shall apply to the accounts and balance-sheet of a provident society being a company incorporated under the Companies Act, 1913, or under the Indian Companies Act, 1882, or under the Indian Companies Act, 1866, or under any Act repealed thereby, as they apply to the accounts and balance-sheet of an insurer and the Chief Controller of Insurance may exercise, in respect of returns made by a provident society and in respect of an investigation or valuation to which section 81 refers, the same powers as are exercisable by him under section 21 and section 22, respectively, in the case of an insurer.

Section 83. Actuarial examination of schemes

(1) Every provident society ¹¹⁰shall cause every scheme of insurance which it proposes to put into operation to be examined by an actuary, and shall not receive any premium or contribution in connection with the scheme until the actuary has certified that the rates, advantages, terms and conditions of the scheme are workable and sound, and such certificate has been forwarded to the Chief Controller of Insurance.

(2) The provisions of sub-section (1) shall apply to any alteration of a scheme already in operation but the Chief Controller of Insurance may, if he is of opinion that the alteration unfairly affects the interests of existing policy-holders, prohibit the alteration, and, if he does so, the society shall not put the altered scheme into operation, unless it first discharges to the satisfaction of the Chief Controller of Insurance all its liabilities to those of the existing policy-holders who dissent from the alteration.

Section 84. Separation of accounts and funds

Where a provident society effects policies of insurance in connection with more than one of the classes of contingency separately specified in sub-section (2) of section 65, the receipts and payments in respect of each such class shall be recorded in a separate account in the cash book kept in accordance with section 79.

Section 85. Investment of funds

(1) Every provident society shall, unless it already holds invested in approved securities or securities mentioned or referred to in clauses (c) and (d) of section 20 of the Trusts Act, 1882, not less than fifty per cent of the total assets of the society, invest in such securities every increase that takes place in those assets and in that part of those assets which is held in cash as soon as practicable after the increase takes place and in any case within six months of its taking place, until the total amount so invested amounts to not less than fifty per cent of the total assets of the society, and shall thereafter keep invested in such securities not less than fifty per cent of the total assets of the society:

Provided that for the purpose of determining the amount to be invested under this sub-section, any deposit made in cash under section 73 shall be taken into account as if such cash were Government securities amounting at the market value of the securities on the date the deposit was made to the total deposited in cash.

(2) No funds or investments of a provident society except a deposit made under section 73 or under the law of any State or country relating to insurance shall be kept otherwise than in the name of the society or in the name of a public officer approved by the Government.

(3) No loan shall be made out of the assets of a provident society, to any director, manager, managing agent, auditor, actuary, officer or partner of the society except on the security of a policy of insurance held in the society and within its

surrender value and no such loan shall be made to any concern of which a director, manager, managing agent, auditor, actuary, officer or partner of the society is a director, manager, managing agent, actuary, officer or partner:

Provided that nothing in this sub-section shall apply to loans made by a provident society to a banking company:

Provided further that where any event occurs giving rise to circumstances, the existence of which at the time of the grant of any subsisting loan would have made such grant a contravention of this sub-section, such loan shall, notwithstanding any contract to the contrary, be repaid within three months from the occurrence of such event or from the commencement of the Insurance (Amendment) Act, 1946, whichever is later; and in case of default, the director, manager, managing agent, auditor, actuary or partner concerned shall, without prejudice to any other penalty which he may incur, cease to hold office in the society on the expiry of the said three months.

¹¹¹(3A) Any loan prohibited under sub-section (3), made before and outstanding at the commencement of the Insurance (Amendment) Act, 1940, shall be repaid before the 1st day of January, 1941, and in case of default the director, manager, managing agent, auditor, actuary, officer or partner who has received the loan or is connected with the concern which has received the loan, as the case may be, shall cease to hold office in or be a partner of the society and shall be ineligible to hold office in or be a partner of the society until the loan is repaid.

(4) Any director, manager, managing agent, auditor, actuary, officer or partner of a society which contravenes the provisions of sub-section (3) who is knowingly a party to the contravention, shall without prejudice to any other penalty which he may incur be jointly and severally liable to the society for the amount of the loan, and such amount, together with interest from the date of the loan at such rate not exceeding twelve per cent per annum as the Chief Controller of Insurance

may fix, shall on application by the Chief Controller of Insurance to any Civil Court of competent jurisdiction be recoverable by execution as if a decree for such amount had been passed by that Court.

(5) The provisions of section 86D of the Companies Act, 1913, shall not apply to a loan granted to a director of a provident society being a company if the loan is once granted on the security of a policy on which the society bears the risk and the policy was issued to the director on his own life and the loan is within the surrender value of the policy.

Section 86. Inspection of books

The books of every provident society shall at all reasonable times be open to inspection by the Chief Controller of Insurance or any person appointed by him in this behalf or by any member or policy-holder of the society who has, on application in this behalf, been permitted by the Chief Controller of Insurance, subject to such conditions, if any, as he may impose, to make such inspection.

Section 87. Inquiry by or on behalf of Chief Controller of Insurance

(1) The Chief Controller of Insurance shall at least once in two years and may, if he thinks fit, at any time visit personally or depute a suitable person to visit the principal office of a provident society or the principal office in Bangladesh of a society having its principal place of business or domicile outside Bangladesh and inquire into the affairs of the society, or may, after giving notice to the society and giving it an opportunity to be heard, direct such an inquiry to be made by an auditor or actuary appointed by him or by both an auditor and an actuary appointed simultaneously, or first by an auditor only or an actuary only and afterwards by an actuary or auditor.

(2) For the purposes of any such inquiry the Chief Controller or the auditor or actuary, as the case may be, shall be entitled to examine all books and documents of the society and may demand from the society or any officer of the society such explanations as he may require on any matter relating to the affairs of the society.

(3) The results of any such inquiry shall be recorded in writing by the person making the inquiry, and four copies of the record shall be supplied to the Chief Controller of Insurance; and when the inquiry is completed, a copy of the

record, or of each such record where more than one are made in the course of the same inquiry, shall be sent by the Chief Controller of Insurance to the society concerned and shall be open to inspection by any member or policy-holder of the society.

(4) All expenses of and incidental to any inquiry made by an auditor or actuary under sub-section (1) including any expenses incurred before the date on which the Chief Controller of Insurance receives notice of an appeal under clause (e) of sub-section (1) of section 110 shall be defrayed by the provident society, shall have priority over other debts due from the society, and shall be recoverable as an arrear of land-revenue.

(5) The Chief Controller of Insurance may, by notice in writing require the provident society to comply within a time to be specified therein (not being less than fifteen days from the receipt of the notice by the society) with any directions he may issue to remedy defects disclosed by an inquiry under this section.

(6) If the society fails to comply with any directions issued under sub-section (5), the Chief Controller of Insurance may, after giving notice to the society and giving it an opportunity to be heard, apply to the Court for the winding up of the society.

Amalgamation and transfer of insurance business

¹¹²87A. (1) The insurance business of a provident society may be transferred to any person or transferred to or amalgamated with the insurance business of any other provident society in accordance with a scheme prepared under this section and sanctioned by the Chief Controller of Insurance.

(2) Any scheme prepared under this section shall set out the agreement under which the transfer or amalgamation is proposed to be effected, and shall contain such further provisions as may be necessary for giving effect to the scheme.

(3) Before an application is made to the Chief Controller of Insurance to sanction any such scheme, notice of the intention to make the application together with a statement of the nature of the amalgamation or transfer, as the case may be, and of the reason therefore, shall at least two months before the application is made, be sent to the Chief Controller of Insurance and certified copies, four in number, of each of the following documents shall be furnished to him, and other such copies shall during the two months aforesaid be kept open for the inspection of the members and policy-holders at the principal and branch offices of the provident societies concerned, namely:-

and the balance-sheets, reports and abstracts referred to in clauses (b), (c) and (d) shall all be prepared as at the date at which the amalgamation or transfer if sanctioned by the Chief Controller of Insurance is to take effect, which date shall not be more than twelve months before the date on which the application to the Chief Controller of Insurance is made under this section:

Provided that the Chief Controller of Insurance may exempt the provident society or societies concerned from furnishing to him and from keeping open for inspection any one or more of the above documents.

(4) When any application such as is referred to in sub-section (3) is made to the Chief Controller of Insurance, he may require, if for special reasons he so directs, notice of the application to be sent to every person resident in Bangladesh; ¹¹³* * * who is the holder of a policy of any provident society concerned and may cause a statement of the nature and terms of the amalgamation or transfer, as the case may be, to be published in such manner and for such periods as he may direct, and after hearing the societies concerned, such policy-holders as apply to be heard and such other persons as he may deem fit, may sanction the arrangement, if he is satisfied that no sufficient objection to the arrangement has been established and shall make such consequential orders as are necessary to give effect to the arrangement, including orders as to the disposal of any deposit made under section 73:

Provided that-

(5) A copy of the order under sub-section (4) sanctioning or refusing to sanction the arrangement shall be sent to each of the societies concerned and to each of the policy-holders who applied to be heard.

(6) If the scheme involves a reduction of the amount of the insurance and other contracts of the transfer or society or of any or all of the societies concerned in the amalgamation, the Chief Controller of Insurance may sanction the scheme, reducing the amount of such contracts upon such terms and subject to such conditions as he may think proper and the reduction of the contracts as sanctioned by the Chief Controller of Insurance shall be valid and binding on all the parties concerned.

Section 88. Winding up by Court and voluntary winding up

(1) The Court may order the winding up of a provident society being a company incorporated under the Companies Act, 1913, or under the Indian Companies Act, 1882, or under the Indian Companies Act, 1866, or under any Act repealed thereby, and the provisions of the Companies Act, 1913, shall, subject to the provisions of this Part, apply accordingly.

(2) In addition to the grounds on which such an order may be based, the Court may order the winding up of a provident society if the Chief Controller of Insurance, who is hereby authorised to do so, applies in this behalf to the Court on any of the following grounds, namely:-

(3) A provident society being a company incorporated under the Companies Act, 1913, or under the Indian Companies Act, 1882, or under the Indian Companies Act, 1866, or under any Act repealed thereby, may be wound up voluntarily in accordance with the provisions of the Companies Act, 1913, but shall not be so wound up except for the purpose of effecting an amalgamation or reconstruction of the society or on the ground that by reason of its liabilities it cannot continue its business.

(4) A provident society not being a company incorporated under the Companies Act, 1913, or under the Indian Companies Act, 1882, or under the Indian Companies Act, 1866, or under any Act repealed thereby, may be wound up voluntarily under this Act if a resolution is passed by the proprietors that the society should be wound up voluntarily for the purpose or on the ground specified in sub-section (3), and the Chief Controller of Insurance may, in any case where he has ordered the cancellation of the registration of a society under sub-section (4) of section 70, order the winding up of the society under this Act.

Section 89. Reduction of insurance contracts

The Court may make an order reducing the amount of the insurance contracts of a provident society upon such terms and subject to such conditions as the Court thinks just-

Application of Act to liquidators

¹¹⁴90A. Notwithstanding anything to the contrary contained in the Companies Act, 1913, the provisions of sections 91, 92 and 93 shall apply to any liquidator appointed to wind up a provident society, whether by the Court, the Chief Controller of Insurance or the society itself.

Section 90. Appointment of liquidator

(1) Where a provident society is to be wound up whether under the Companies Act, 1913, or under this Act, the society shall, within seven days from the date of the order of the Court ordering the winding up or the passing of the resolution authorising the winding up, as the case may be, give notice thereof to the Chief Controller of Insurance and, except where the winding up is done by an order of the Court, the Chief Controller of Insurance shall appoint the liquidator and shall determine the remuneration to be paid to him:

Provided that if the Chief Controller of Insurance is not satisfied that the assets of the society are sufficient to meet the costs of liquidation including the remuneration of the liquidator, he may decline to make such appointment, and in such a case the society shall itself appoint a liquidator who shall carry out the liquidation as if the winding up was being done by an order of the Court.

(2) Any liquidator appointed by the Chief Controller of Insurance under sub-section (1) may be removed by the Chief Controller of Insurance if satisfied that the duties entrusted to him are not being properly discharged.

Section 91. Powers of liquidator

(1) A liquidator appointed to wind up a society shall have power-

(2) The liquidator shall, for settling the list of contributories and realising the amount of contributions, have the same powers as an official liquidator appointed by the Court for the winding up of a company under the Companies Act, 1913.

Section 92. Procedure at liquidation

(1) As soon as a liquidator is appointed to wind up a society he shall take charge of all property movable or immovable of the society and of all its books and documents.

(2) If any proprietor or officer of the society or any other person retains any portion of the assets of the society or fails to deliver to the liquidator any book or document when so required by the liquidator he shall be punishable with imprisonment which may extend to six months, or with fine which may extend to five hundred Taka, or with both, and the Court may order the delivery of the assets or book or document to the liquidator.

(3) The liquidator shall, within fifteen days of his appointment, send notice by post to all persons who appear to him to be creditors of the society that a meeting of the creditors of the society will be held on a date not being less than twenty-one nor more than twenty-eight days after his appointment, and at a place and hour to be specified in the notice, and shall also advertise notice of the meeting once in the ¹¹⁵* * official Gazette and once at least in two newspapers ¹¹⁶ * *.

(4) At the meeting so held the creditors shall determine whether an application shall be made for the appointment of any person as liquidator in the place of or jointly with the liquidator already appointed, or for the appointment of a committee of inspection, and, if they so resolve and an application accordingly is made at any time not later than fourteen days after the date of the meeting by any creditor appointed for the purpose at the meeting, the Chief Controller of Insurance shall appoint a suitable person in place of or jointly with the liquidator already appointed, and determine the remuneration to be paid to him, and if so desired, shall also appoint a committee of inspection.

(5) The committee of inspection shall, subject to any prescribed conditions, have a general power of supervision over the acts of the liquidator and shall have the right to inspect his accounts at all reasonable times.

(6) The liquidator shall, with such assistance from an actuary as may be required, ascertain as soon as practicable the amount of the society's liability to every person appearing by the society's books to be entitled to or interested in any policy issued by the society, and shall give notice of the amount so found to each such person in the prescribed manner and each such person on receiving such notice shall be bound by the value so ascertained.

(7) The liquidator shall make a valuation of the assets of the society and an estimate of the costs of the winding up, and shall on the basis of these, settle the list of contributories.

(8) The liquidator shall apply to the Chief Controller of Insurance for an order for the return of the deposit made by the society under section 73 and the Chief Controller of Insurance shall on such application order the return of the deposit subject to such terms and conditions as he may think fit.

(9) In administering and distributing the assets of the society the liquidator shall have regard to any directions that may be given by the creditors or contributories at a general meeting or by the Chief Controller of Insurance.

(10) The liquidator shall keep books of account in which he shall record the proceedings at all meetings attended by him, all amounts received or expended by him and any other matter that may be prescribed, and these books may, with the sanction of the Chief Controller of Insurance, be inspected by any creditor or contributory.

(11) If the winding up continues for more than a year, the liquidator shall summon a meeting of the creditors and contributories at the end of the first year and of each succeeding year, and shall lay before them an account of his acts and dealings and of the conduct of the winding up, and that account together with any views expressed thereon by the meeting shall be forwarded by the liquidator to the Chief Controller of Insurance.

(12) So far as is not otherwise provided herein or is not otherwise prescribed under this Act, the liquidator shall so far as practicable follow the procedure to be followed by an official liquidator appointed by the Court for the winding up of a company under the Companies Act, 1913.

(13) The costs of the liquidation including the remuneration of the liquidator and any expenses incurred under clause (g) of sub-section (1) of section 91 shall, if the liquidator decides that they shall be payable out of the assets of the society, be payable in priority to all other claims.

Section 93. Dissolution of provident society

(1) As soon as the affairs of a provident society are fully wound up, the liquidator shall prepare an account of the winding up showing how the winding up has been conducted and the property of the society has been disposed of and shall call a meeting of the members, creditors and contributories for the purpose of laying before it the account and giving any explanation thereof.

(2) Notice of the meeting shall be sent to each person individually and shall be advertised in the ¹¹⁷* * official Gazette and in at least two newspapers ¹¹⁸ * *.

(3) Within one week after the meeting the liquidator shall send to the Chief Controller of Insurance a copy of the account and shall report to him the holding of the meeting and its date and shall forward to him a copy of the proceedings of the meeting.

(4) The Chief Controller of Insurance may return the account to the liquidator if it is incomplete or unsatisfactory and may require the liquidator to carry out any further steps necessary to complete the winding up and the liquidator shall comply with such requirement and shall submit a further report to the Chief Controller of Insurance within six months.

(5) If the Chief Controller of Insurance is satisfied that the affairs of the society have been fully wound up he shall register the account of the liquidator who shall forthwith make over to the Chief Controller of Insurance sums, if any, remaining undisposed of, and on the expiry of three months from the registering of the account the Chief Controller of Insurance shall declare the society dissolved and cause the dissolution of the society to be notified in the official Gazette, and the liquidator shall thereupon be discharged from further responsibility.

(6) If within a period of five years from the date on which any sums have been made over to the Chief Controller of Insurance under sub-section (5) an order of a Court of competent jurisdiction has not been obtained at the instance of any claimant to such sums for their disposal the said sums shall become the property of Government.

Section 94. Nominations and assignments

(1) The provisions of section 38 and section 39 relating to assignment, transfer and nomination in the case of life insurance policies shall, subject to the provisions of this section, apply to policies of insurance issued by any provident society covering any of the contingencies specified in clause (a) of sub-section (2) of section 65.

(2) No nomination shall be valid if the person nominated is not the husband, wife, father, mother, child, grand-child, brother, sister, nephew or niece of the holder of the policy.

Section 95. Definitions

(1) In this Part-

¹¹⁹(b) “Co-operative Insurance Society” means an insurer, being a society registered under any law governing the registration of co-operative societies.

¹²⁰* * *

(2), (3) and (4) ¹²¹Omitted by section 12 of the Insurance (Amendment) Ordinance, 1984 (Ordinance No. L of 1984).

Section 96. Application of Act to Mutual Insurance Companies and Co-operative 122[* * *]Life Insurance Societies

The provisions of sections 6 and 7 and of sub-section (2) of section 20, so far as those provisions are inconsistent with the provisions of this Part, shall not apply, and the provisions of this Part shall apply to Mutual Insurance Companies and Co-operative ¹²³* * * Insurance Societies.

Working capital of Mutual Insurance Companies and Co-operative Insurance Societies

¹²⁴97. No Mutual Insurance Company incorporated after the commencement of the Insurance (Amendment) Ordinance, 1984 (L of 1984), and no Co-operative Insurance Society registered after that date under any law governing the registration of co-operative societies shall be registered under this Act, unless it has as working capital a sum specified in the Seventh Schedule, exclusive of the deposit to be made before application for registration and of the preliminary expenses, if any, incurred in the formation of the company or society.

Section 98. Deposits to be made by Mutual Insurance Companies and Co-operative Insurance Societies

Every Mutual Insurance Company and every Co-operative Insurance Society shall deposit at the time of making application for registration and keep deposited with the Bangladesh Bank, for and on behalf of the Government, the amount specified in the Seventh Schedule either in cash or in approved securities estimated at the market value of the securities on the day of the deposit.

Section 98A. Prohibitions of loans

The provisions of section 29 shall apply to Co-operative Insurance Societies as they apply to other insurers.]

Section 99. Transferees and assignees of policies not to become members

No transferee or assignee of a policy issued by an insurer to whom this Part applies shall become a member of a Mutual Insurance Company or a Co-operative ¹²⁵* * * Insurance Society merely by reason of any such transfer or assignment.

Section 100. Publication of notices and documents of Mutual Insurance Companies and Co-operative 126[* * *] Insurance Societies

Notwithstanding the provisions of section 79 and section 131 of the Companies Act, 1913, a Mutual Insurance Company or a co-operative ¹²⁷* * Insurance Society may, instead of sending the notices and the copies of the balance-sheet, revenue account and other documents which they are required to send to the members under those sections, publish such notices or documents once in a newspaper published in the English language and in a newspaper published in the local language circulating in the place where the principal office of the company is situated. ¹²⁸ * *

Section 101. Supply of documents to members

Every Mutual Insurance Company and every Co-operative ¹²⁹* * Insurance Society shall, on the application of any member made within two years from the date on which any such document is furnished to the Registrar of Companies under the provisions of section 134 of the Companies Act, 1913, or to the Registrar of Co-operative Societies ¹³⁰ * *, furnish a copy of the document free of cost to the member within fourteen days of the application.

Section 102. Penalty for default in complying with, or act in contravention of this Act

(1) Except as otherwise provided in this Act, any insurer who makes default in complying with or acts in contravention of any requirement of this Act, and, where the insurer is a company, any director, managing agent, manager or other officer of the company, or where the insurer is a firm, any partner of the firm who is knowingly a party to the default, shall be punishable with fine which may extend to ¹³¹one lakh Taka and not less than fifty thousand Taka and, in the case of a continuing default, with an additional fine which may extend to ¹³²ten thousand Taka for every day during which the default continues.

(2) Any provident society as defined in Part III which makes default in complying with or acts in contravention of any of the requirements of this Act and any director, managing

agent, manager, secretary or other officer of the society who is knowingly a party to the default or contravention, shall be punishable with fine which may extend to ¹³³five thousand Taka or, in the case of a continuing default or contravention with fine which may extend to ¹³⁴five hundred Taka for every day during which the default or contravention continues.

Section 103. Penalty for transacting insurance business in contravention of sections 3, 7 and 9

(1) Any insurer or any person acting on behalf of an insurer, who carries on any class of insurance business in contravention of any of the provisions of section 3, section 7, or section 98, or does any one or more of the acts constituting the business of insurance in relation to any insurance business carried on in contravention of any of the said sections shall be punishable with fine which may extend to ¹³⁵ten thousand Taka.

(2) Any person knowingly taking out a policy of insurance with any insurer or person guilty of an offence under sub-section (1) shall be punishable with fine which may extend to ¹³⁶five thousand Taka:

Provided that nothing in sub-section (1) or sub-section (2) shall apply to the business of re-insurance between the head office of an insurer in Bangladesh and the head office of an insurer not having an office in Bangladesh.

(3) Any provident society or any person acting on behalf of a provident society who carries on any class of insurance business in contravention of any of the provisions of section 70, section 73 or section 83 or does any one or more of the acts constituting the business of insurance in relation to any insurance business carried on in contravention of any of the said sections shall be punishable with fine which may extend to one thousand Taka.

Section 104. Penalty for false statement in document

Whoever, in any return, report, certificate, balance-sheet or other document, required by or for the purposes of any of the provisions of this Act, wilfully makes a statement false in any material particular, knowing it to be false, shall be punishable with imprisonment for a term which may extend to three years, or with fine which may extend to ¹³⁷ten thousand Taka, or with both.

Section 105. Wrongfully obtaining or withholding property

(1) Any director, managing agent, manager or other officer or employee of an insurer who wrongfully obtains possession of any property of the insurer or having any such property in his possession wrongfully withholds it or wilfully applies it to purposes other than those expressed or authorised by this Act shall on the complaint of the Chief Controller of Insurance made after giving the insurer not less than fifteen days' notice of his intention, or, on the complaint of the insurer or any member or any policy-holder thereof, be punishable with fine which may extend to ¹³⁸ten thousand Taka and may be ordered by the Court trying the offence to deliver up or refund within a time to be fixed by the Court any such property improperly obtained or wrongfully withheld or wilfully misapplied and in default to suffer imprisonment for a period not exceeding two years.

(2) This section shall apply in respect of a provident society as defined in Part III as it applies in respect of an insurer.

Section 106. Power of Court to order restoration of property of insurer or compensation in certain cases

(1) If, on the application of the Chief Controller or an Administrator appointed under section 52A or an insurer or any policy-holder or any member of an insurance company or the liquidator of an insurance company (in the event of the insurance company being in liquidation), the Court is satisfied-

manager, secretary or liquidator) or any officer, employee or agent of the insurer,-

the Court may examine any such insurer, director, managing agent, manager, secretary or liquidator or any other officer, employee or agent of the insurer or such other person, as the case may be, and may compel him to contribute such sums to the assets of the insurer by way of compensation in respect of the misapplication, retainer, misfeasance or breach of trust as the Court thinks fit, or to pay such sum as may be found due from him in respect of any money or property of the insurer for which he is liable or accountable or to restore any money or property of the insurer or any part thereof, as the case may be; and where the amount of the life insurance fund has been diminished by reason of any contravention of the provisions of this Act, the Court shall have power to assess the sum by which the amount of the fund has been diminished and to order the person guilty of such contravention to contribute to the fund the whole or any part of that sum by way of compensation; and in any of the aforesaid cases the Court shall have power to order interest to be paid at such rate and from such time as the Court may deem fit.

(2) Without prejudice to the provisions contained in sub-section (1) or sub-section (3), where it is proved that any money or property of an insurer has disappeared or has been lost, the Court shall presume that every person in charge of, or

having a disposing power over, such money or property at the relevant time (whether a director, manager, principal officer or any other officer) has become accountable for such money or property within the meaning of sub-clause (i) of clause (a) of sub-section (1), and the provisions of that sub-section shall apply accordingly, unless such person proves that the money or property has been utilised or disposed of in the ordinary course of the business of the insurer and for the purpose of that business or that he took all reasonable steps to prevent the disappearance or loss of such money or property or otherwise satisfactorily accounts for such disappearance or loss.

(3) Where the insurer is an insurance company and any of the acts referred to in clauses (a), (b) and (c) of sub-section (1) has been committed by any person, every person who was at the relevant time a director, managing agent, manager, liquidator, secretary or other officer of the insurance company shall, for the purposes of that sub-section be deemed to be liable for that act in the same manner and to the same extent as the person who has committed the act, unless he proves that act was committed without his consent or connivance and was not facilitated by any neglect or omission on his part.

(4) Where at any stage of the proceedings against any person under this section (hereinafter referred to as the delinquent), the Court is satisfied by affidavit or otherwise-

(5) For the purposes of sub-section (4), the following classes of property shall be deemed to belong to a delinquent:-

Explanation.- For the purposes of this section a person shall be deemed to be a nominee of a delinquent, if, whether directly or indirectly, he possesses on behalf of the delinquent, or may be required to exercise on the direction or on behalf of the delinquent, any right or power which is of such a nature as to enable the delinquent to exercise or to entitle the delinquent to acquire control over the company's affairs.

(6) Any claim to any property attached under this section or any objection to such attachment shall be made by an application to the Court and it shall be for the claimant or objector to adduce evidence to show that the property is not liable to attachment under this section, and the Court shall proceed to investigate the claim or objection in a summary manner.

(7) When disposing of an application under sub-section (1), the Court shall, after giving all persons who appear to it to be interested in any property attached under this section an opportunity of being heard, make such order as it thinks fit respecting the disposal of any such property for the purpose of effectually enforcing any liability under this section, and all such persons shall be deemed to be parties to the proceedings under this section.

(8) In any proceedings under this section the Court shall have full powers and exclusive jurisdiction to decide all questions of any nature whatsoever arising thereunder and in particular, with respect to any property attached under this section, and no other Court shall have jurisdiction to decide any such question in any suit or other legal proceeding.

(9) In making any order with respect to the disposal of the property of any private company referred to in clause (b) of sub-section (5), the Court shall have due regard to the interests of all persons interested in such property other than the delinquent and persons referred to in that clause.

(10) This section shall apply notwithstanding that the act is one for which the person concerned may be criminally liable.

(11) In proceedings under this section the Court shall have all the powers which a Court has under section 237 of the Companies Act, 1913.

(12) This section shall apply in respect of a provident society as defined in Part III as it applies in respect of an insurer.

(13) The Court entitled to exercise jurisdiction under this section shall be the High Court Division ¹³⁹* * * and any proceedings under this section pending immediately before the commencement of the Insurance (Amendment) Ordinance, 1960, in any Court other than the High Court Division shall, on such commencement, stand transferred to the High Court Division.

(14) The ¹⁴⁰Supreme Court may make rules providing for-

Notice to and hearing of Chief Controller of Insurance

¹⁴¹106A. (1) When application is made to the Court for the making of any order to which this section applies the Court shall, unless the Chief Controller of Insurance has himself made the application or has been made a party thereto, send a copy of the application together with intimation of the date fixed for the hearing thereof to the Chief Controller of Insurance, and shall give him an opportunity of being heard.

(2) The orders to which this section applies are the following, namely:-

Section 107. Previous sanction of Attorney General for institution of proceedings

(1) Except where proceedings are instituted by the Chief Controller of Insurance, no proceedings under this Act against an insurer or any director, manager or other officer of an insurer or any person who is liable under sub-section (2) of section 41 shall be instituted by any person unless he has previous thereto obtained the sanction of the ¹⁴²Attorney-General to the institution of such proceedings.

(2) This section shall apply in respect of a provident society as defined in Part III as it applies in respect of an insurer.

Section 108. Power of Court to grant relief

If in any proceedings, civil or criminal, it appears to the Court hearing the case that a person is or may be liable in respect of negligence, default, breach of duty or breach of trust but that he has acted honestly and reasonably and that having regard to all the circumstances of the case he ought fairly to be excused for the negligence, default, breach of duty or breach of trust, the Court may relieve him either wholly or partly from his liability on such terms as it may think fit.

Section 109. Cognizance of offences

No Court inferior to that of a Magistrate of the first class shall try any offence under this Act.

Section 110. Appeals

(1) Except as otherwise provided in this Act, any person aggrieved by any order, direction or decision in respect of the following matters may, within a period of thirty days from the date of the communication of such order, direction or decision, appeal against it to the Insurance Appellate Tribunal constituted under sub-section (2), namely:-

(2) The Government shall, for the purpose of hearing appeals under sub-section (1), constitute an Insurance Appellate Tribunal consisting of such number of members not exceeding seven, including a Chairman as it may appoint.

(3) The Chairman shall be a person who is qualified to be a Judge of the ¹⁴³Supreme Court and the other members shall be persons possessing such qualifications and experience as may be prescribed.

(4) The Chairman and other members shall hold office for a period of three years from the date of appointment on such terms and conditions as may be prescribed.

(5) The Chairman may constitute such number of benches of the Tribunal as may be necessary for the expeditious disposal of appeals under sub-section (1); and each such bench shall consist of such number of members, not less than two, as may be prescribed.

(6) Subject to the provisions of this Act and the rules made thereunder, the Tribunal shall regulate its own procedure and shall, for the purpose of hearing an appeal, have the same powers as are vested in a civil Court trying a suit under the Code of Civil Procedure, 1908 (Act V of 1908), in respect of the following matters namely:-

(7) If, in the course of the hearing of an appeal, any member of the Tribunal ceases, for any reason, to hold office, the proceedings of the Tribunal shall be stayed and the Government shall appoint another member in his place; and the hearing may continue before the Tribunal from the stage at which it was stayed as if there has been no change in the membership of the Tribunal.

(8) If, in the course of the hearing of an appeal, any one on the members is, for any reason, unable to attend the sitting of the Tribunal the hearing shall continue before, and the decision may be given by, the remaining members.

(9) If upon any matter requiring the decision of the Tribunal there is a difference of opinion amongst its members, the opinion of the majority shall prevail and the decision of the Tribunal shall be expressed in terms of the views of the majority:

Provided that where the members are equally divided on any point it shall,-

(10) The Tribunal shall be deemed to be a civil Court for the purposes of section 195 of the Code of Criminal Procedure, 1898 (Act V of 1898), and a Court subordinate to the High Court Division ¹⁴⁴* * * for the purpose of the Contempt of Courts Act, 1926 (XII of 1926), and any proceeding before the Tribunal shall be deemed to be a judicial proceeding within the meaning of sections 193 and 228 of the ¹⁴⁵Penal Code (Act XLV of 1860).

(11) The Tribunal may issue a stay order against any order of the Government or the Chief Controller of Insurance.

(12) Any person aggrieved by a decision of the Tribunal may appeal to the High Court Division if the case is certified by the Tribunal, in the prescribed manner, to be a fit one for appeal to the High Court Division.

(13) In this section, unless the context otherwise requires,-

Delegation of powers and duties of Chief Controller of Insurance

¹⁴⁶110A. The Chief Controller of Insurance may by general or special order delegate any of his powers or duties under this Act to any person subordinate to him. The exercise or discharge of any of the powers or duties so delegated shall be subject to such restrictions, limitations and conditions, if any, as the Chief Controller of Insurance may impose, and shall be subject to his control and revision.

Section 110B. Signature of documents

Every document which is required by this Act or by any rule made thereunder to be signed by the Chief Controller of Insurance or by any person subordinate to him or by any officer authorised by him under sub-section (1) of section 42 or sub-section (1) of section 42A or sub-section (4) of section 44A shall be deemed to be properly signed, if it bears a facsimile of the signature of such Chief Controller, person or officer printed, engraved, lithographed or impressed by any other mechanical process approved by the Government.]

Powers to call for information

¹⁴⁷110C. (1) The Chief Controller may by notice in writing require any insurer to supply him any information relating to his insurance business and the insurer shall comply with such requirement within such period after the receipt of the notice as may be specified therein.

(2) Any information supplied under this section shall be certified by the principal officer if the insurer and if the notice so requires, also by an auditor.

Section 111. Service of notices

(1) Any process or notice required to be served on an insurer or provident society shall be sufficiently served if addressed to any person registered with the Chief Controller of Insurance as a person authorised to accept notices on behalf of the insurer or provident society and left at, or sent by registered post to, the address of such person as registered with the Chief Controller of Insurance.

(2) Any notice or other document which is by this Act required to be sent to any policy-holder may be addressed and sent to the person to whom notices respecting such policy are usually sent and any notice so addressed and sent shall be deemed to be notice to the holder of such policy:

Provided that, where any person claiming to be interested in a policy as transferee, assignee or nominee has given to an insurer or to a provident society notice in writing of his interest, any notice which is by this Act required to be sent to policy-holders shall also be sent to such person at the address specified by him in his notice.

Section 112. Declaration of interim bonuses

Notwithstanding anything to the contrary contained in this Act an insurer carrying on the business of life insurance shall be at liberty to declare an interim bonus or bonuses to policy-holders whose policies mature for payment by reason of death or otherwise during the inter-valuation period on the recommendation of the investigating actuary made at the last preceding valuation.

Section 113. Acquisition of surrender values policy

¹⁴⁸(1) A policy of life insurance under which the whole of the benefits become payable either on, or at a fixed interval or intervals after, the occurrence of a contingency which is bound to occur shall, if all premiums have been paid,-

acquire a guaranteed surrender value which shall not be less than the minimum guaranteed surrender value prescribed in respect of such policy.

(1A) In prescribing the minimum guaranteed surrender value for the purpose of sub-section (1), regard shall be had to the term of the policy and the contingency on the occurrence of which the benefits become payable.

(1B) Every insurer and every provident society shall within a period of one year-

submit to the Chief Controller of Insurance for his approval, a statement showing the basis and formula on which the guaranteed surrender value of the policies issued by such insurer or society is determined; and the Chief Controller of Insurance, before according his approval, may, after giving the insurer or the provident society an opportunity of being heard, direct such modifications to be made in the basis and formula as he may deem fit.

(1C) No basis and formula approved under sub-section (1B) shall be modified without the previous approval in writing of the Chief Controller.

(2) Notwithstanding any contract to the contrary and subject to any option exercised by the policy-holder under section 50A, a policy which has acquired a surrender value shall not lapse by reason of the non-payment of further premiums but shall be kept alive to the extent of the paid-up sum insured, and the paid-up sum insured shall for the purposes of this sub-section include in full all subsisting reversionary bonuses that have already attached to the policy, and shall, where the policy is one on which the maximum number of annual premiums payable is fixed and the premiums are of uniform amount, be before the inclusion of such bonuses not less than the amount bearing to the total sum insured by the policy exclusive of bonuses the same proportion as the total period for which premiums have already been paid bears to the maximum period for which premiums were originally payable.

(3) A policy kept alive to the extent of the paid-up sum insured under sub-section (2) shall not be entitled by virtue of that sub-section to participate in any profits declared distributable after the conversion of the policy into a paid-up policy.

(4) Sub-section (2) and sub-section (3) shall not apply,-

Power to amend Schedules

¹⁴⁹114A. The Government may, by notification in the official Gazette, make such amendments in the Schedules as it may deem fit.

Section 114B. Powers of the Chief Controller

The Chief Controller shall exercise the powers given to him by or under this Act in accordance with such general or special directions, if any, as may be issued by the Government.]

Section 114. Power of Government to make rules

(1) The Government may, subject to the condition of previous publication by notification in the official Gazette, make rules to carry out the purposes of this Act.

(2) In particular and without prejudice to the generality of the foregoing power, such rules may prescribe-

¹⁵⁰(aa) the form and language of documents issued to the public by insurers;

¹⁵¹* * *

(3) [Omitted by section 11 of the Insurance (Amendment) Act, 1993 (Act No. XII of 1993).]

(4) [Omitted by section 3 and the Second Schedule of the Bangladesh Laws (Revision And Declaration) Act, 1973 (Act No. VIII of 1973).]

Section 115. Alteration of forms

The Government may, on the application or with the consent of an insurer, not being a company, alter the forms contained in the Schedules as respects that insurer, for the purpose of adapting them to the circumstances of that insurer:

Provided that nothing done under this section shall exempt the insurer from supplying all information required under this Act so far as it is possible for the insurer to do so.

Section 116. [Omitted.]

[Power to exempt from certain requirements.- Omitted by section 3 and the Second Schedule of the Bangladesh Laws (Revision And Declaration) Act, 1973 (Act No. VIII of 1973).]

Summary returns to be published

¹⁵²116A. The Government shall every year cause to be published, in such manner as it may direct, a summary of the accounts, balance-sheets, statements, abstracts and other returns under this Act or purporting to be under this Act which have been furnished in pursuance of the provisions of this Act to the Chief Controller of Insurance during the year preceding the year of publication, and may append to such summary any note of the Chief Controller of Insurance or of the Government and any correspondence:

Provided that nothing in this section shall require the publication of the statement referred to in sub-section (2) of section 10 or sub-section (4) of section 13 in respect of the first valuation of an insurer or sub-section (2) of section 32A or section 42B or of the returns referred to in sub-section (1) of section 28.

Section 117. Saving of provisions of Companies Act, 1913

Nothing in this Act shall affect the liability of an insurer being a company or a provident society as defined in Part III being a company to comply with the provisions of the Companies Act, 1913, in matters not otherwise specifically provided for by this Act.

Section 118. Exemptions

Nothing in this Act shall apply to any Trade Union registered under the ¹⁵³Industrial Relations Ordinance, 1969 or to any insurance business carried on by the Government, or to any provident fund to which the provisions of the Provident Funds Act, 1925, apply, or, if the Chief Controller of Insurance so orders in any case, and to such extent or subject to such conditions or modifications as he specifies in such order, to-

Section 119. Inspection and supply of copies of published prospectus, etc.

Any person may on payment of a fee of five Taka inspect the documents filed by an insurer with the Chief Controller of Insurance under clause (f) of sub-section (2) of section 3, and may obtain a copy of any such document or part thereof on payment in advance at the prescribed rate for the making of the copy.

Section 120. Determination of market value of securities deposited under this Act

The market value on the day of deposit of securities deposited in pursuance of any of the provisions of this Act with the Bangladesh Bank shall be determined by the Bangladesh Bank whose decision shall be final.

Advisory Board

¹⁵⁴120A. The Government shall constitute an Advisory Board to advise the Chief Controller in the performance of his duties under this Act.

Publicity Board

¹⁵⁵120AA. The Government may constitute a Publicity Board to perform such functions as may be prescribed.

Section 120B. [Omitted.]

[Regional Offices.- Omitted by section 3 and the Second Schedule of the Bangladesh Laws (Revision And Declaration) Act, 1973 (Act No. VIII of 1973).]

]

121, 122 and 123. [Amendment of section 130, Act IV of 1882., Amendment of Schedule I, Act IX of 1908 and Repeals.- Omitted by section 3 and 2nd Schedule of the Repealing and Amendment Ordinance, 1965 (Ordinance No. X of 1965).]