




































Indian Journal of Finance and Banking 

 Vol. 6, No. 1; 2021 

                                       ISSN 2574-6081   E-ISSN 2574-609X 

Published by CRIBFB, USA 

 

73 

THE IMPACT OF COVID-19 ON THE INSURANCE INDUSTRY OF 

BANGLADESH 
 

 

Anamul Haque 

Assistant Professor 

Department of Banking and Insurance 

University of Chittagong, Bangladesh 

E-mail: anam.haq@cu.ac.bd  

 

Nishat Taslin Mohona 

Undergraduate Student 

 Department of Banking and Insurance 

University of Chittagong, Bangladesh 

E-mail: nishatmohona06@gmail.com 

 

Sabrin Sultana 

Undergraduate Student 

 Department of Banking and Insurance 

University of Chittagong, Bangladesh 

E-mail: sabrinsultana1060@gmail.com 

 

Umme Kulsum 

Undergraduate Student 

 Department of Banking and Insurance 

University of Chittagong, Bangladesh 

E-mail: ummekulsum.ctg2018@gmail.com 

 

 

ABSTRACT 

This study investigates the impact of Covid-19 on the insurance industry of Bangladesh. We utilize a 

quarterly panel data of top-performing both life and non-life companies for the duration between 

Q1:2018 to Q1:2021. We depend on the quantitative method to determine the exact scenario 

implementing through the fixed effect model. The finding explains that the adverse effect of the pandemic 

is significant on the quarterly premium income, insurance density, and penetration. A robustness test 

further justifies the validity of the findings. We discuss the causes behind decline to portraits real scenario 

of such harsh impact. The sector demands potential measures that ensure a stable situation. 

 

Keywords: Covid-19, Lockdown, Insurance Industry of Bangladesh. 

 

JEL Classification Codes: G22, I18, I19. 

 

 

 

mailto:E-mail:%20anam.haq@cu.ac.bd


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INTRODUCTION 

The mass global tension and challenge nowhere is the SARS-CoV2 (Covid-19), a highly contagious 

infection with acute death cases, was first identified in Wuhan city, Hubei province, China, in December 

2019 (Shi et al., 2020). By the end of January 2020, it was declared public health emergency by the World 

Health Organization (WHO). It has been annunciated and attained a pandemic status on March 11th, 

2020. However, in the meantime, it had spread across 215 territories and countries on all five continents 

(Wang et al., 2020). The countries like the USA, Brazil, India, UK, and Spain have experienced peak 

cases and deaths. As of June 2021, (WHO, 2021) reports there have been more than 175 million 

confirmed cases of Covid-19, including over 3.8 million deaths, which is one of the deadliest pandemics 

in the world's history.  

South Asia is gradually joining the ranks of Covid-19-affected countries, with the first verified 

Covid-19 case in this region as reported on January 24th in Nepal by a Nepalese student who had recently 

returned from China (Chalise, 2020). On January 27th and January 30th, respectively, Sri Lanka and 

India announced the first confirmed COVID-19 cases. The cumulative number of Covid-19 cases in South 

Asia was 3,649 on April 1st, up to 62,895 on May 1st, and above 200,000 on May 21st. SAARC (2020) 

reports that the total deaths soared from 71 on April 1st to 1,772 on May 1st and about 5,000 on May 

21st. According to IEDCR (Institute of Epidemiology, Disease Control, and Research) in Bangladesh, 

the first Covid-19 confirmed cases dug out on March 8th, 2020. The USA Embassy in Dhaka had 

identified Bangladesh as one of the most 25 vulnerable countries affected by the epidemic, with a high 

risk of spreading in March. On March 26th, the government imposed a general lockdown for the first 

time extended till May. Afterward, concerning the economic impact in the developing economy like 

Bangladesh, the lockdown has been eased. Till now, Covid-19 cases in Bangladesh are showing up more 

than 8 lakhs, and deaths are 13 thousand. 

This pandemic has exposed a catastrophic result in the world economy due to preventive measures 

like social distancing, lockdown, counteracting travel compliance with the acute health crisis (Kleinberg 

et al., 2020). (Khan et al., 2020)) Addressed that the recession has crashed the world economy by the 

increment of business shutdown and unemployment problem. Further, different sectoral shocks like 

manufacturing, services, trade, and tourism are also the worst sufferer of the world economy (Feyisa, 

2020). It has already resulted in various economic and social disruptions leading to a decline in services, 

investment, industrial production activities, and worldwide consumption (Wang et al., 2020). During this 

pandemic, non-performing loans have exceeded, causes additional credit risks over financial sectors 

(Ozili & Arun, 2020). The global financial market and the particular stock market have faced enormous 

economic shocks (Zhang et al., 2020). The Covid-19 has a catastrophic effect on developed economies. 

For example, the unemployment rate in the USA has risen to a record 14.7%, with more than 20 million 

jobs lost, and GDP dropped by 4.8% in the very first quarter of 2020 (Hutt, 2020). For an emerging 

economy like China, the sealing airport and close contact with them have caused a 2% decline in Chinese 

economic growth. As China dominates 16% of the world's economic activities, any disruption to the 

Chinese economy also hits the world economy  (Fernandes, 2020). The shutdown directly affected the 

developing economy's real output and overall sectors indirectly (Khurshid & Khan, 2021). The reduction 

of raw material export, a steep decline in remittance, and costly access to the international market worsen 

the situation for developing countries (Loayza & Pennings, 2020). While developed economies responded 

through direct transfer and regular social insurance payments to their workers suffered by lockdown, the 

developing economy cannot respond immediately due to the lack of fiscal capacity, broad informal 

sectors, and a greater purview of intergenerational households (Alon et al., 2020). In this situation, the 

lack of adequate policy may lead to recession and even depression in the long run (Khurshid & Khan, 

2021).  



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A developing country like Bangladesh is undergoing tremendous economic trouble in 

international and domestic demands because of the coronavirus outbreak and lockdown. The spread of 

the coronavirus tremendously affected Bangladesh's economies and financial sectors. By inhibiting the 

pandemic's first wave by implementing social distancing, pandemic protocol, and vaccination, the second 

wave of COVID-19 hit back again, and the country had to go through partial lockdown repeatedly. The 

partial lockdown extended economic burden, socio-economics insecurity (Bodrud-Doza et al., 2020). 

With the rise of unemployment, poverty, remittances, healthcare crisis, quality education, and downward 

slope of RMG export, Bangladesh might experience stand back its Sustainable Development Goals 

(SDG) (Shammi et al., 2020). Furthermore, downfall in the oil prices and depressed demand, the 

remittance flow of Bangladesh represents a negative outward as Bangladesh's GDP constitutes 7% of 

international remittances (Aneja & Islam, 2020). Moreover, due to travel restrictions, the tourism industry 

in Bangladesh observed an adverse effect because of losing revenue (Deb & Nafi, 2020). Governments 

and financial institutions seek an escape from total annihilation, leading to cast new hope from the 

insurance industry. The government promulgated various financial packages of about USD 11.90 billion 

(Islam et al., 2020), though the global uncertainty shocks remarkably and hit Bangladesh's economy 

through increasing economic challenges exponentially in the agriculture, industry, and service sectors 

(Ahmed, 2021; Begum et al.,  2020).  

The scope of this study is the insurance industry. The insurance market of Bangladesh is exposed 

to an adverse condition as the COVID-19 outbreak, which still exists in Bangladesh. Insurance 

Development and Regulatory Authority (IDRA) reports both the life and non-life insurance companies' 

growth rate of gross premium from the first quarter of 2020 to the second quarter of 2020 was -20.42%; 

shows a sharp drop in growth. Maximum non-life insurance policies, such as fire insurance, marine 

(cargo) insurance, motor insurance, miscellaneous insurance, faced negative growth rates of gross 

premium. Our study showcases the present condition of the insurance industry in Bangladesh during the 

pandemic. Without the well-being of insurance companies, the pandemic seems to have a catastrophic 

effect on the whole economic sector. Therefore, this economy will not be able to overcome the crisis to 

make genuine progress. Thus, assuredly, this is of practical and policy value for exploring how the Covid-

19 pandemic influences the insurance market of Bangladesh. Furthermore, this study can enrich to the 

insurance industry professionals because almost no study has been conducted yet in this subject matter. 

An empirical investigation examines the impact of Covid-19 on insurance in China reveals a negative 

impact in the short term (Wang et al., 2020). Motivated from the study, an attempt has made to mitigate 

the research gap and illustrate the impact of Covid-19 on the Bangladesh insurance industry. Therefore, 

the study endeavored to understand the consequence of Covid-19 influence on the insurance sector in 

Bangladesh. 

Data includes the total 20 top life and non-life insurance companies based on their premium 

income for the years 2018, 2019, 2020, and the first quarter of 2021. Through mean-variance tests and 

panel data regression, we find that Covid-19 results in a decrease in the quarterly premium growth. Here, 

we contribute the body of knowledge to determine the effect of the Covid-19 crisis on Bangladesh's 

insurance industry, including how insurance elements react to such incidents. This study sought to explore 

the way crisis can break potential and well-established market's natural tone. This research benefits the 

policymaker and insurance professionals to exercise crucial decisions regarding stable insurance industry, 

and stakeholders to prioritize safety and security. 

The following is how the rest of the article is structured: Section 2 introduces the data, 

econometric model and defines the variables. Then, section 3 reports the results and discusses the 

empirical findings. Moreover, the final section wraps up the research. 

 



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LITERATURE REVIEW 

Insurance is considered an innovative risk financing technique to protect the best interests of risk-averse 

individuals (Cummins & Barrieu, 2013; Spence & Zeckhaser, 1978; Outreville, 1998; Schoemaker & 

Kunreuther, 1979). The purposes of underlying insurance demand are contingency mutually exclusive 

and jointly exhaustive consumption opportunities (Ehrlich & Becker, 1972). The development of the 

insurance industry is highly correlated with economic growth (Ćurak et al., 2009 ; Devarakonda, 2016). 

The insurance industry contributes a vital role by steering and promoting investment and savings in a 

particular economy (Gupta, et al., 2014). It is challenging for businesses to encounter all the risks and 

uncertainties (Ahmed et al.,  2011). That is why the profitability and solvability of insurance companies 

matter the most to have a stabilized economy (Kripa & Ajasllari, 2016). An individual gets relief from 

possible adverse and uncertain events outcome of activity through insurance. Overall, insurance facilities 

reduce risk and benefit personal and domestic security (Uddin et al., 2014). The appearance of the 

pandemic causes numerous unexpected situations and shocks like liquidity problems, portfolio risk, 

reliance on reinsurance, asset crisis and protection risk, etc. (Babuna et al., 2020). (Larson & Sinclair, 

2021) found that in the current Covid-19 pandemic, unemployment insurance claims have jumped 

significantly.  

Among the European countries, the insurance industry demonstrated a disruptive negative impact 

during the Covid-19 outbreak due to imbalances in the number of claims with the capital and solvency 

stability (Puławska, 2021). This region also reports a reduction in the Return on Asset (ROA) among the 

German and Italian insurance companies; the solvency ratio in the Belgian, French, and German 

insurance industries. Despite the significant financial losses produced by Covid, the insurance industry 

was not adequately prepared to deal with the losses (Levantesi & Piscopo, 2020). Similarly, (Farooq et 

al., 2021) conducted a study on Australia, Canada, Germany, the USA, UK, Brazil, India, and Indonesia 

found Covid-19's negative effect on the stock returns both in the short and long terms on insurance firms. 

Other studies like; (Kirti & Shin, 2020) alarmed that this pandemic will keep impacting insurers directly 

and indirectly via health shocks such as an increase in mortality and morbidity and indirectly via financial 

shocks, which are higher credit spreads, lower equity prices, and widespread downgrades. For example, 

considering the global situation, there has already been a predicted downslope in property insurance, 

cargo insurance, life insurance (Zhang et al., 2020).   

The developing economies have also experienced the adverse impact of this epidemic on 

investment amount and income of the commercial insurance companies due to having a great influence 

on the expenditure (Xia et al., 2020). In this regard, studies (e.g.,Ye et al., 2021) suggest similar results. 

Chinese insurance industry reveals that the stock prices dropped overall in the initial quarter. Also, it 

exposes that the increase of Covid-19 cases decreases the gross commercial insurance premium, 

insurance density, and insurance depth among the Chinese insurers. The overall significant downwards 

spiral has been witnessed in the industry in the short term (Wang et al., 2020) after considering insurance 

density and depth, especially the personal insurance. The industry has witnessed similar losses in North 

Macedonia (Stojkoski et al., 2020), Ethiopia (Worku & Mersha, 2020), Ghana (Babuna et al., 2020), and 

India (Parvathi & Lalitha, 2021). In the South Asia, till the end of 2020 the Covid-19 impact was not 

adverse in India. Moreover, the impact of Covid-19 on life insurance companies is positive. This is 

evident by (Ramasamy, 2020) who found that insurance companies are attracting more customers and 

gaining profits during this Covid-19 situation because people are scared and wanted to obstruct the 

financial crisis if they are affected by the aforesaid pandemic.  

Undoubtedly, the Covid-19 pandemic has created an unexpected and extensive economic shock 

among the insurance companies in every economy. However, no empirical research has been done on the 

impact of the epidemic on Bangladesh's insurance industry. As a result, the study aims to determine the 



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77 

impact of Covid-19 on the insurance industry in Bangladesh. We hypothesize that there is a significant 

impact of Covid-19 in the Bangladeshi insurance industry. 

 

DATA AND METHODS 

Variables and Sample 

This study utilizes the hand-collected data of the top 20 life and non-life insurance companies in 

Bangladesh. The top performers have been listed based on their premium income. To illustrate the effect 

of the Covid-19, we collect our panel data quarterly for the years 2018, 2019, 2020, and the first quarter 

of 2021 based on the data availability. Though the outbreak hits the country in March 2020, due to the 

disruption of the global economy, the impact has started affecting the economy from the beginning of 

2020. Here, the years 2018 and 2019 are considered to be before the pandemic, and the year 2020 and 

2021 are considered during the pandemic situation. Table-1 portraits the independent variable, dependent 

variables, and control variables with descriptions and data sources used in this study. 

 

Table 1.  Description of Variables 

Variables Variable name Description Data Sources 

Independent variable 

 

Covid_Dummy 

(C_Dummy) 

0 for the non-Covid-

19 situation and 1 for 

the Covid-19 

situation 
Official website of IEDCR 

(Institute of Epidemiology, 

Disease Control, and 

Research) 

 

  

Confirmed Covid-19 

cases (QCASES) 

 

The log of total 

number of confirmed 

cases per quarter 

Dependent variable 

 

Quarterly premium 

growth (QPG) 

Gross premium 

income growth 

generated per 

quarterly 

Official website of IDRA 

(Insurance Development & 

Regulatory Authority) 

 

 

 

 

Insurance density 

(INSD) 

 

The ratio of gross 

premium per 

population 

 

Insurance 

penetration (INSP) 

 

The ratio of gross 

premium to GDP 

Control variable 

 

Consumer price 

index (CPI) 

Quarterly CPI (using 

the base year 2005-

2006) 

Official website of BBS 

(Bangladesh Bureau of 

Statistics) 

 

 

  

 

Producer price index 

(PPI) 

Quarterly PPI (using 

the base year 2005-

2006) 



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Econometric Model 

Consistent with (Wang et al., 2020), we develop the following fixed-effects econometric model to 

estimate the Covid-19 impact on the insurance industry of Bangladesh. 

 

𝑸𝑷𝑮𝒊𝒕 = 𝜶𝟎 + 𝜶𝟏𝑪𝑶𝑽𝑰𝑫 𝑫𝒖𝒎𝒎𝒚𝒕 + 𝜶𝟐𝑪𝑷𝑰𝒕 + 𝜶𝟑𝑷𝑷𝑰𝒕 + 𝜶𝟒𝑮𝑫𝑷𝒕𝒕 +ηt + εt 

 

Where QPGit represents the overall firm-level quarterly premium growth at a given fixed time. 

Apart from this QPG, insurance density (INSD), and penetration (INSP) are also used as the performance 

indicators of the insurance industry of Bangladesh in subsequent models. COVID_dummy is a dummy 

variable where 0 indicates the non-Covid-19 situation and 1 indicates the Covid-19 situation, valued in 

time margin. CPIt, PPIt, lGDPt are the economic variables that have considerable influence over the 

dependent variables. The subscript i denotes the insurance firms, and t refers to the time from January 

2018 to March 2021, and the ηt, εt report as the time fixed effects and the error term. For the robustness 

test, we modified the equation to explore the significance of the pandemic on the Bangladeshi insurance 

market through developing an alternative independent variable nCoVt, which stands for the log of the 

number of confirmed Covid-19 cases to measure the pandemic intensity given a period.  

 

Summary Statistics 

The Covid-19 has a catastrophic impact on the Bangladesh economy in various dimensions due to 

pandemic protocols like lockdown, social distancing, and economies shut down. Here, Table-2 exhibits 

the summary statistics of the explained variables (quarterly premium growth, insurance density, and 

penetration), the explanatory variable (quarterly Covid-19cases, Covid-19_Dummy), and the control 

variable (CPI, PPI, lGDP). Since there are no other studies in such a type, therefore we failed to compare 

the summary statistics with any other researchers.  

 

Table 2. Summary Statistics 

Results 

We start with the simple mean-variance test to compare the insurance industry position of Bangladesh 

between prior and posterior to the Covid-19 pandemic. Then, Table 3 reports the mean-variance test of 

quarterly premium growth, insurance density, and insurance penetration before the pandemic and during 

 

 

Per capita gross 

domestic product 

(lGDP) 

The logarithm of 

quarterly per capita 

GDP 

 

 

Variable Observation Mean Std. Dev. Min Max 

QPG 260 -0.4127967 3.280285 -5.26316 1.960784 

INSD 260 753.9231 64.58476 664 824 

INSP 260 0.5453846 64.58476 0.49 0.57 

QCASES 260 841.9231 1478.556 0 4355 

lGDP 260 6.152011 0.059413 6.037274 6.200408 

CPI 260 267.66 13.46967 247.02 290.76 

PPI 260 221.9654 2.109232 220.32 226.33 

C-Dummy 260 0.3076923 0.4624286 0 1 



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the pandemic. Results show that the mean difference between prior and posterior to the Covid-19 

pandemic of Bangladesh industry is statistically significant. The findings are consistent with (Wang et 

al., 2020), who also observed the Covid-19 pandemic’s impact on the Chinese insurance market. 

Therefore, we can interpret that Covid-19 results in a decrease in quarterly premium growth. There is no 

significant effect on insurance density in Bangladesh during the covid-19 pandemic because people may 

have more insurance policies concerning their health and property. However, a significant difference is 

shown in the table between the mean-value of insurance penetration which tells us that there is a negative 

impact on the overall development of the insurance industry during the pandemic. 

Table 4 reports the baseline regression results, which reflect that COVID-19 has a significant 

negative impact on the insurance industry of Bangladesh in terms of premium growth, insurance density, 

and penetration. The coefficients results are robust and economically significant as well. The controls 

have expected signs too. The results are consistent with other studies (e.g., Wang et al., 2020) that indicate 

that the financial ramifications of the Covid-19 pandemic affect Bangladesh's general economic activity, 

resulting in a drop in income and incur a high household medical cost. Also, in Bangladesh, insurance is 

a last-resort financial decision after paying for all kinds of household expenditures (Werner, 2009). 

During this pandemic, people face unexpected income loss and higher medical expenses; therefore, the 

insurance sector faces a severe income loss. In addition, the disruption in overall business activity worsens 

the situation for most non-life insurance companies. 

In addition, as a part of the robustness check, we do an alternative measurement of the Covid-19 

pandemic crisis that has been reported in table-5. We develop a continuous variable based on the log of 

quarterly confirmed cases reported in Bangladesh. It is observed that the quarterly premium growth, 

insurance density, and penetration, all certain variables, have experienced a significant reduction during 

the Covid-19. The robust check carried using quarterly data from January 2018 to March 2021. Here, the 

coefficient of quarterly gross premium and quarterly confirm Covid-19 cases reveals significant 

influence. The rising number of covid-19 cases has a quantitatively significant adverse effect on premium 

growth, insurance density. Table-5 displays Covid-19 negative effects on the gross premium of the 

Bangladeshi insurance market. By each unit increase of Covid-19 confirm case droops 4.912 percent of 

the premium. Furthermore, insurance density adversely causes by the rise of Covid-19, each confirmed 

case by BDT .0168 million losses. Insurance penetration negatively accelerated by every upward move 

in quarterly confirm Covid-19 cases by .0132 percent. Overall, Covid-19 contrarily hit quarterly premium 

growth, insurance density, and insurance penetration. The drastic Covid-19 force is demoting insurance 

market harmony over the pandemic period.  

 

Table 3. Mean-variance tests 

 

 Prior to the Pandemic During the Pandemic T-test 
 

Obs Mean Std. 

Err. 

Std. 

Dev. 

Obs Mean Std. 

Err. 

Std. 

Dev. 

Mean Difference 

Quarterly 

Premium 

Growth 

180 1.743 0.046 0.618 80 -5.263 0 0 -7.006*** 

Insurance 

Density 

180 747.555 5.699 76.304 80 768.25 1.510 13.508 20.694*** 

Insurance 

Penetration 

180 0.560 0.001 0.015 80 0.5125 0.001 0.013 -.048*** 

Note: The symbols ***, **, and * represent significance levels of 1%, 5%, and 10%, respectively.  



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Table 4. Baseline Regression 

 

 

Table 5. Robustness Check 

 

 

Discussion  

We observe that all dependent variables experience negative effects during the Covid-19 pandemic. There 

are a variety of explanations for such events. Among them, first of all, insurers face a shortage of liquidity, 

portfolio risk, and reinsurance protection during this pandemic. In addition, social distancing and 

containment measures limit the general communication of people. Thus, commercial activity is reduced. 

Furthermore, due to several episodes of congestion, all kinds of economic activities have come to a halt, 

negatively affecting all international trade, tourism, hotels, and limited infrastructure, in as many 

industries that depend on these sectors are also important related to premium growth (Dev & Sengupta, 

2020). In addition, businesses have faced many crises, including order cancellations and travel restrictions 

(Salehnia et al., 2020). Thus, the impact on new insurance sales is determined to be reduced. On the other 

hand, the crisis has hit a number of insurers who suffered extremely serious complications during Covid-

 Model 1 Model 2 Model 3 

 QPG INSD INSP 

C-Dummy -6.986664*** -81.26438*** -0.009292*** 

 .1261954 13.76703 .0024771 

CPI -0.0238834*** 2.644873*** -0.0023557*** 

 .0071859 .7839297 .0001411 

PPI -0.065095*** 4.479256*** -0.0001098*** 

 .020187 2.202254 .0003963 

lGDP  10.23456*** 413.8841*** 0.2139321*** 

 1.33061 145.1602 .0261186 

Quarterly FE Y Y Y 

N 260 260 260 

Overall R sq- 0.984 0.5099 0.9039 

Note: The symbols ***, **, and * represent significance levels of 1%, 5%, and 10%, respectively.  

 Model 1 Model 2 Model 3 

 QPG INSD INSP 

QCASES -.0013715*** -.0167691*** -0.00000487*** 

 .0000535 .0030637 4.65e-07 

CPI -.1262271*** 1.576169*** -.0020384*** 

 .0118746 .6799259 .0001031 

PPI -.7972185*** -4.111605*** -.001364*** 

 .0329888 1.888896 .0002864 

lGDP 33.87509*** 675.3449*** .1950288*** 

 2.177175 124.6622 .1950288 

Quarterly FE Y Y Y 

N 260 260 260 

Overall R-sq 0.9410 0.5009 0.9305 

Note: The symbols ***, **, and * represent significance levels of 1%, 5%, and 10%, respectively.  



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19 due to declining premium collections and increasing claims. Liquidity is considered to be an important 

factor related to insurance. As a result, massive claims attacks on cash reserves create an uncomfortable 

state in insurance companies (Acharya & Steffen, 2020).  

At the household level, the number of new car purchases decreased as all stores were restricted 

from opening. Auto insurance fell on because of no limited-time motor vehicle sales, indicating a 

dramatic drop in auto insurance coverage. New trends and coverage are dwindling. The travel ban 

prevented potential new buyers from enforcing the travel policy (Salehnia et al., 2020). Because, paying 

without specific consequences seems trivial. Furthermore, even before the pandemic as a developing 

country with financial constraints, most Bangladeshis were not interested in having a general insurance 

policy (Werner, 2009). The situation is also worsening as the operations of companies have been closed 

for several days, leading to unemployment and low income, which explains a negative result of insurance 

density. 

Although penetration is not enough, Bangladesh has great potential in the insurance sector due to 

stable GDP growth. However, this pandemic has hampered strength due to rising unemployment, 

declining purchasing power, and per capita income (Ahamed, 2021). This ultimately leads to negative 

growth in insurance penetration. While there is the prospect of an explosive health insurance penetration 

rate during the outbreak, the lack of a marketing, awareness, and digitalization strategy will limit the 

likelihood of contracting the disease. 

 

CONCLUSION 

The global impact of government-ordered business closures to contain the Covid-19 outbreak has been 

enormous, resulting in different economic variations. Therefore, social aspects regarding pandemic 

mitigation, household spending, and consumption are all being considered in relation to Covid-19 

research. However, few empirical studies have been conducted on the impact of the epidemic on the 

insurance market in developing countries such as Bangladesh. In this regard, this study aims to contribute 

to the growing literature on the impact of Covid-19 on the Bangladesh insurance industry using company-

level panel data and fixed-effects models. By comparing Covid-19 and non-Covid-19 states, the results 

show that this pandemic has a significant contribution to the contraction of the insurance sector. The 

regression models also signal a negative impact of the Covid-19 pandemic on Bangladesh's insurance 

industry. This short-term negative impact is reflected in premium growth, insurance density, and 

insurance penetration. The results were statistically significant and robust compared with other measures. 

This study has certain limitations that should be noted. It is difficult to understand the impact of the 

pandemic on the insurance market in Bangladesh due to the lack of sample size, recent data, and time 

constraints. The researchers continued to work by developing large panel data and looking at longer time 

periods. We also hope that future researchers will tackle the channels of the Covid-19 pandemic causing 

misery for insurance companies. However, while talking about management effects, this research will 

allow decision-makers and managers to understand the risk they are exposed to when taking out an 

insurance contract. 

 

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