Golden Life Insurance Faces Crisis Amid Unpaid Claims and Regulatory Scrutiny
Private insurer Golden Life Insurance Limited is grappling with a severe crisis, characterized by a cash crunch, unpaid claims, and operational breakdowns. The company, established in 1999, has shuttered its headquarters, with many key officials absent, and is facing the challenge of serving approximately 18,000 policyholders awaiting their dues.
The Daily Star’s business desk reported on the unfolding situation.
Headquarters Closure and Financial Distress
Following a political transition in August of last year, the insurer’s troubles have intensified. The head office, situated at Ambon Complex in Dhaka’s Mohakhali area, has been closed for more than a month. This closure came after a confrontation between frustrated policyholders and company staff, triggered by the firm’s failure to settle claims totaling Tk 34.95 crore.
Amzad Hossain Khan Chowdhury, Chief Executive Officer of Golden Life Insurance, acknowledged the gravity of the situation. “The head office has remained closed for the past 20 days in a row. We are making our best efforts to resolve the current problem,” he stated.
While Chowdhury claimed that branch offices are operating “as usual,” the company’s inability to pay salaries to nearly 200 employees and its failure to clear overdue rent for its headquarters highlight its financial distress, prompting concerns about its solvency.
Years of Mismanagement
The current crisis stems from years of operational mismanagement and governance failures. Chowdhury cited irregularities between 2011 and 2014, including unreported policies and unsubmitted money receipts by field-level employees, which created a backlog of liabilities. “When these clients claimed their funds, the money went pending,” the CEO explained.
He added that after the political changeover in August, funding for operations was abruptly halted, leading to a cessation of claim settlements from September and the suspension of staff salaries.
A recent visit to the company’s head office revealed locked doors on the 3rd and 5th floors of Ambon Complex. A notice at the building entrance read: “The office is currently closed. A strike is underway due to the board’s failure to provide promised funds on time. We kindly ask customers for their patience.”
A senior official of the building’s management informed The Daily Star that Golden Life has not paid rent, electricity, or water bills for two months. However, the insurer has reportedly promised to settle the dues after the upcoming Eid-ul-Fitr and vacate the premises.
Regional Office Affected
The crisis at headquarters has also impacted Golden Life’s regional offices. A visit to its Chattogram divisional office on March 16 found only one official present, with the office head’s room locked and no other staff in sight.
Regulatory Intervention
Amid the unfolding crisis, the Insurance Development and Regulatory Authority (Idra) has intervened. The company’s managing director, head of accounts, and company secretary were summoned by Idra last week for updates. While the deadline for resolving the issue was yesterday, the company failed to meet it and requested more time. The regulator granted the request, scheduling the next meeting for March 20.
Md Apel Mahmud, Idra’s member for life insurance, emphasized the severity of the situation: “A company cannot operate like this. They also do not have the authority to shut down a company’s head office in this manner. There are certain systems and rules in place.”
AKM Azizur Rahman, the chairman of Golden Life Insurance, assured Idra in a letter that all outstanding urgent claims will be settled within the next 30 days.
Golden Life’s troubles are not new. A special audit conducted by Idra in 2022 uncovered significant irregularities, resulting in a Tk 22 lakh fine, which remains unpaid. Furthermore, the company has failed to provide approval documents for its 14 insurance products, raising more concerns about compliance and governance. Golden Life’s total assets stand at Tk 55.85 crore, with 140,000 policyholders. Bangladesh has 82 insurance companies, 36 in the life insurance sector and 46 in the non-life sector.
