Digital Transformation Adoption in the Insurance Sector of Bangladesh: A Quantitative Study from the Perspective of Insurer

Abstract

The process of digitization exerts a profound influence on societal behavior and culture, as well as on the operational procedures of the service sector and the financial framework and growth of a nation. The primary obstacle lies in the adoption of suitable digital transformation strategies, which can facilitate the development of innovative business models, processes and systems. The objective of this research was to investigate the current state of digitization within the insurance sector of Bangladesh, as well as to identify the challenges encountered by industry participants in their transition towards digitalization. The present study was conducted utilizing questionnaires as the primary research instrument. Questionnaires were developed with the purpose of gathering information from staff members at insurance companies in Bangladesh regarding the challenges faced by these companies in their digital transformation efforts. The insurance employee’s comments indicate that the barriers for insurance companies in Bangladesh to transition to digital platforms are significant. The marks assigned to all of the investigated barriers were determined to be above the average mark. The staff identified incorrect regulation as the most significant barrier, followed by a strict organizational structure, security concerns, and the complexity of offering products online. In contrast, customer willingness to use online platforms was found to be somewhat low, albeit still above average. This implies that the regulatory body plays a significant influence in influencing Bangladeshi insurance businesses to adopt digital technologies. Based on the analysis of the findings, it is recommended that the insurance oversight body in Bangladesh should support the implementation of digital transformation within insurance companies. Additionally, Bangladeshi insurance firms should consider adopting suitable digital platforms to effectively engage with their customers, particularly in order to efficiently manage the significant number of customers seeking online insurance services. If this trend continues, the insurance industry could experience significant growth, which could have a salutary effect on the economy as a whole over time.

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