Written by The Banking Post
The Bangladesh Textile Mills Association (BTMA) has urged the government to immediately settle pending insurance claims for textile mills damaged during the July–August 2024 mass uprising, warning that prolonged delays are deepening the sector’s crisis.
In a letter to the Finance Adviser, BTMA President Showkat Aziz Russell also sought compensation for affected industrial units and outlined a set of recommendations to speed up the claims process, sources said.
The association said many member mills suffered vandalism, looting, and arson during the unrest, causing severe production losses. Most of the affected factories had comprehensive insurance coverage, including fire and related risks, through non-life insurers.
However, more than a year later, little progress has been made in settling most claims, Russell noted. He said mill owners were facing “extreme frustration and uncertainty” due to the absence of clear guidance from the insurance regulator.
BTMA also expressed concern that insurers might try to deny payments by invoking the Riot and Civil Commotion clause, and demanded a clear, transparent interpretation to prevent misuse.
Among its proposals, BTMA recommended:
- A circular directing non-life insurers to prioritise and resolve pending claims related to the mass uprising within 90 days of receiving all required documents, in line with the Insurance Act, 2010.
- A fast-track mechanism, in partnership with Sadharan Bima Corporation (SBC), to clear the reinsurance component quickly.
The stalemate is hampering mills’ ability to resume production, putting thousands of workers’ jobs at risk, Russell warned. “This is not just a crisis for a few companies but a serious threat to the overall economy, particularly the garment export supply chain,” he said.
As of 2024, BTMA has 1,863 member mills, including 527 yarn mills, 994 fabric mills, and 342 dyeing, printing, and finishing units.
