Very few factories in any industry in Bangladesh have insurance for their workers although almost all have various kinds of insurance to protect their assets in case of accidents.
This results in a scenario where factory owners can be compensated in case of accidents while the families of workers who lose their lives are left with nothing.
Despite mandatory group insurance for factories with more than 100 workers, owners simply ignore this legal requirement.
The recent fire at Tampaco Foils factory on September 10 that killed 25 workers and injured more than 70 has once again brought the safety coverage issue of workers' lives to light. The Tampaco owner took insurance coverage only for the assets while workers were neglected.
The company took insurance coverage of Tk66 crore against its assets from four general insurance companies. But no group insurance was taken covering the workers.
According to the amended labour law, institutions having more than 100 workers will have to take group insurance.
Tazreen fire, another major accident in Bangladesh's RMG sector, killed over 100 workers in 2012. The garment owner took fire insurance policy of Tk18 crore with Karnaphuli Insurance. He took group insurance coverage for only 20 workers with Delta Life insurance just to pass as a compliant factory to get export permit.
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The devastating fire that swept through the food and cigarette packaging factory in Gazipur on September 10, following a huge explosion Dhaka Tribune/Mahmud Hossain Opur
Rana Plaza collapse in 2013 killed 1,135 people in the country’s worst industrial disaster. Five garment factories were housed in Rana Plaza and none of them were compliant with the rule of mandatory group insurance policy.
The survivors of accident was compensated from welfare fund of the Bangladesh Garment Manufacturers and Exporters Association and foreign donations. Many survivors are leading miserable lives with heavy injuries.
According to the amended labour law, any organisation which has a minimum of 10 workers will have to introduce accident insurance scheme for owners and workers under a joint insurance programme.
Zuber Ahmed Khan, member of Insurance Development and Regulatory Authority, said: “Business owners take insurance policy while taking bank loans, as insurance is a must for loans. As a result, business owners take insurance only covering their mortgaged assets.”
He said only the labour law mandated insurance coverage for workers but it was not implemented properly.
Business owners were reluctant to take group insurance policy due to huge premium costs, Zuber said. He suggested that owners should introduce group insurance with the help of subsidies.
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