[lg policy] Sri Lanka’s private insurance providers exploit language barrier

Harold Schiffman haroldfs at gmail.com
Fri Jun 15 15:55:44 EDT 2018

Sri Lanka’s private insurance providers exploit language barrier:
Research Author
LBO <http://www.lankabusinessonline.com/author/editor/>
Posted on June 15, 2018
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Jun 15, 2018 (LBO) – Sri Lanka’s top five general insurance providers which
account for two-thirds of the market share, is seem to exploit the language
barrier as none of them issue insurance documents for certain policies in
Sinhala and Tamil, a recent research showed.

The research study conducted by Verité Research has found out that solving
the lethargy on language policy will help SMEs Island-wide when it comes to
natural disaster insurance in Sri Lanka.

SME owners who were affected by the May 2017 floods in the Ratnapura
district, were of the view that they had purchased natural disaster
insurance through agents representing private insurance companies.

“However, they realised that they had been misinformed by the agent selling
the insurance only after the disaster, when they attempted to claim their
compensation,” Verité Research said.

“The SME owners had not been able to verify the assurances provided by the
agents as the documents they signed were exclusively in English.”

The English literacy level is substantially lower in the regions outside
the western province and it exposes the vulnerability of regional and rural
business to potential exploitation by insurance agents.

“Generally, these agents are not direct employees of insurance companies,”
Verité Research highlighted.

“These agents are incentivised to sell as many insurance policies as
possible as remuneration is based on the premiums collected and the number
of new enrollments.”

The availability of fire insurance policy documents in all three languages
of selected insurance companies is illustrated below.

According to Verité Research, all selected companies have reported that the
documents were readily available in English but only People’s Insurance
supplied the documents in the Sinhala language.


Subsequent to an application sent by Verité to receive information on the
matter, the Insurance Board of Sri Lanka has replied by stating that No
rules or any related documents have been issued by the Insurance Board of
Sri Lanka on specifying language to be used in drafting insurance related

“Regulations in the banking sector have addressed the language policy
problem by issuing a direction to all licensed commercial banks, specifying
that the terms and conditions of banking products and services shall be
made available to customers in their preferred language,” Verité said.

“As of yet, there is no equivalent regulation in the insurance industry
requiring companies to provide insurance documents in a customer compatible
Sri Lankan language.”


 Harold F. Schiffman

Professor Emeritus of
 Dravidian Linguistics and Culture
Dept. of South Asia Studies
University of Pennsylvania
Philadelphia, PA 19104-6305

Phone:  (215) 898-7475
Fax:  (215) 573-2138

Email:  haroldfs at gmail.com

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