Highlighting the Critical Realities of Insurance: Disparities and Challenges Emerge in Recent Report

โ€ฆ๐’•๐’‰๐’† ๐’Ž๐’‚๐’‹๐’๐’“๐’Š๐’•๐’š ๐’๐’‡ ๐‘ฉ๐’‰๐’–๐’•๐’‚๐’๐’†๐’”๐’† ๐’‚๐’…๐’–๐’๐’•๐’”, 77.0%, ๐’‰๐’‚๐’—๐’† ๐’Š๐’๐’”๐’–๐’“๐’‚๐’๐’„๐’† ๐’„๐’๐’—๐’†๐’“๐’‚๐’ˆ๐’†, ๐’˜๐’Š๐’•๐’‰ ๐’‰๐’Š๐’ˆ๐’‰๐’†๐’“ ๐’๐’˜๐’๐’†๐’“๐’”๐’‰๐’Š๐’‘ ๐’Š๐’ ๐’“๐’–๐’“๐’‚๐’ ๐’‚๐’“๐’†๐’‚๐’”, 86.3%, ๐’‚๐’๐’… ๐’‚๐’Ž๐’๐’๐’ˆ ๐’Ž๐’‚๐’๐’†๐’”, 80.5%

Tshering Dorji

In a recent report released by the Royal Monetary Authority of Bhutan, the state of insurance coverage among Bhutanese adults has been thoroughly examined, shedding light on various aspects of ownership, preferences, and satisfaction levels.


The majority of Bhutanese adults, 77.0%, possess insurance coverage, with higher ownership in rural areas at 86.3% and among males at 80.5%. Life insurance is the most common, with 72.0%, followed by general life insurance at 49.1%, while retirement saving (pension) has the lowest ownership, at under 2%. Among various life insurance products, rural life insurance is the most popular choice at 90.8%, followed by millennium education and money-back policies with lower ownership rates. Understanding of other insurance products is limited.

Regarding general life insurance policies, rural house insurance is the most common type, followed by vehicle insurance, building insurance, and livestock insurance. However, insurance policies related to crops, stock market, machinery, and factory have low ownership, indicating limited utilization and understanding of these types of insurance. Among retirement savings options, a substantial percentage of the adult population owns provident fund (76.8%) and pension (68.3%), but ownership of life annuity policies is low at 7.3 percent. The Royal Insurance Corporation of Bhutan Limited (RICBL) holds a dominant position in the insurance market, accounting for 81.8 percent of insurance products and services used by both urban and rural individuals, as well as males and females.


The main reasons cited by the Bhutanese adult population for having insurance policies are to cover the risk (54.4% to 70.4%) and being required by the law (54.4% to 70.4%). Additionally, recommendations from friends and family are also a significant factor in owning insurance policies across both rural and urban areas, and among both males and females. Other reasons, such as institutional requirements and tax benefits, have lower influence in motivating individuals to avail insurance policies. Satisfaction with insurance products and services is generally high among policyholders. The highest satisfaction ratings are for the ‘helpfulness of the staff’ (80.2%), ‘documentation required’ (76.5%), ‘fee charged’ (75.5%), and ‘time taken to avail the services’ (73.8%). However, there is room for improvement to increase ‘highly satisfied’ ratings and enhance overall customer experience.

The majority of adult Bhutanese prefer cash deposit to relevant institutions for paying insurance premiums. The usage of mobile apps and salary deductions for premium payments is relatively low, but higher among urban adults (14.3%) compared to rural adults (4.3%). This indicates a difference in payment preferences between urban and rural areas, with urban residents showing more interest in digital payment methods for insurance premiums.


Only six percent of Bhutanese adults made insurance claims in the past two years. Fortunately, 92.0 percent of these claims were successfully settled, while around five percent were not settled. A small percentage of individuals, around 3%, were unsure about their claims, indicating a need for better communication and transparency between insurance providers and policyholders. Among Bhutanese adults with insurance policies, the majority (63.9%) prefer to claim insurance products and services directly through the insurance company, indicating a preference for a straightforward and personalized claims process. Some adults also reported claiming through gewog offices. The use of other channels such as agents and mobile apps is relatively low.

Policyholders in Bhutan express high satisfaction with the procedures of claiming insurance benefits. Most policyholders rate the ‘helpfulness of the staff’ and ‘documentation required’ as the most satisfying aspects. Additionally, they are content with the ‘amount compensated’ and the ‘time taken to avail the services’. While the majority of policyholders in Bhutan are satisfied with the insurance claiming process, there is room for improvement in certain areas, particularly the time taken to settle claims. Insurance companies can streamline their processes for faster and smoother claim settlements to enhance customer satisfaction.


The discontinuation of insurance policies among the adult population in Bhutan is minimal, with only around 1 percent discontinuing their policies in the last two years. A higher proportion of urban adults and males reported discontinuing their policies compared to rural adults and females. The main reasons for discontinuation were a reduction in income and the policy not being considered beneficial or relevant to their needs. However, the overall low percentage of discontinuation suggests that most individuals recognize the value of maintaining their insurance coverage.


Overall, the satisfaction level with insurance company services and attributes in Bhutan is moderately high. The most positively rated aspects include ‘time taken to deliver the services,’ ‘reliability of services provided,’ and ‘timely follow-up of renewal of policies.’ However, there are areas for improvement, as satisfaction is lower in ‘clarity of information’ and ‘knowledge of insurance products and services.’ While the level of dissatisfaction is relatively low, the number of ‘highly satisfied’ individuals is notably lower compared to those who are ‘satisfied.’ There is also a significant portion of the population who reported being ‘neither satisfied nor dissatisfied’ with various services and attributes. These findings suggest that enhancing information clarity, product knowledge, and timely follow-ups for policy renewals can further increase overall customer satisfaction with insurance services.


The main reasons for not having insurance policies among adults in Bhutan are not feeling the need for insurance (50.4%), insufficient income (33.5%), and lack of knowledge about insurance (25.0%). Adult males more frequently cited reasons like ‘reduction in income’ and ‘policy not being beneficial,’ while more adult females mentioned ‘prefer other saving products’ as a barrier to availing insurance policies. Indeed, the pattern of reasons for not availing insurance policies is consistent across both rural and urban areas. However, a higher proportion of rural adults mentioned barriers such as ‘did not feel the need’ and ‘did not know about insurance’ compared to their urban counterparts.

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