Disasters cost Nepal $7 billion in last four decades

Nepal's disaster landscape is impacted by earthquakes, floods, landslides, and droughts, which collectively have caused almost $7 billion in damages from 1980 to 2020. These disasters have affected the country's capacity to build financial resilience in the face of looming disasters., according to a report.

The government has spent Rs 50 billion ($0.4 billion) between 2012 and 2020 in disaster response and recovery. The expenditure data indicates that this is not financially sustainable in the long run, which demands the development of risk transfer solutions. In response to this pressing need, the UN Development Programme Nepal today launched the Insurance and Risk Finance Initiative.

It is part of UNDP's global initiative, the Insurance and Risk Finance Facility (IRFF), which is being implemented in over thirty countries. This initiative seeks to prioritise financial resilience by tapping into the benefits of insurance and risk financing mechanisms.

During the event, the Country Diagnostic Report was jointly unveiled by revenue secretary Dr Ram Prasad Ghimire, chief executive officer of the National Disaster Risk Reduction and Management Authority (NDRRMA) Anil Pokhrel and UNDP's resident representative Ayshanie Medagangoda-Labé.

The diagnostic highlighted that Nepal is one of the top ten countries most affected by climate change and is highly vulnerable to floods, landslides, earthquakes, and droughts, according to a press note issued by the UNDP.

The report also showcases that the government is committed to fostering the insurance industry's ability to provide accessible and affordable insurance products, as evidenced by recent legal updates such as the Insurance Act 2079, which contains several microinsurance provisions.

While credit-life microinsurance and agriculture insurance offer financial protection to low-income and vulnerable Nepali households, the overall inclusive insurance market is still lagging due to low awareness about insurance and data gaps that prevent insurance companies from offering products that meet the needs of customers, it adds.

Revenue secretary Dr Ram Prasad Ghimire, on the occasion, reiterated the government's commitment to delivering risk finance solutions, mentioning that the government has already initiated the development of a  Fiscal Risk Management Framework.

Likewise, CEO of NDRRMA Anil Pokharel highlighted the importance of collaboration between government, development partners and the private sector to address increasingly frequent and complex climate and disaster risks. 

“Insurance and risk financing are among the solutions that can contribute to strengthening a comprehensive risk management approach for any country and community,” UNDP resident representative Ayshanie Medagangoda-Labé, on the occasion, said, adding, “We need to tap into the insurance market opportunities, leaving no one behind,”

The Initiative will work closely with government partners such as the Finance Ministry, Nepal Insurance Authority and National Disaster Risk Reduction and Management Authority to improve legal and regulatory environment for insurance to be better incorporated in risk management priorities and actions.

It will also work with the insurance industry to identify the financial protection needs of vulnerable groups such as women, farmers and businesses and facilitate the offer of customer-centric insurance products. UNDP will work more broadly with other development actors also pushing for financial resilience to further advocate and make the case for insurance as a key ingredient in managing shocks and fast-tracking recovery.

Sebon mulls over licensing a new stock exchange

The government is planning to give licence to a new stock exchange before the election.

The Securities Board of Nepal (Sebon) has approved the amendment to the Securities Market Operation Regulations 2007 last week and sent it to the Finance Ministry for ‘further processes’. The ministry will then present it to the cabinet for final approval. The government is in haste to give licence to a new stock exchange as the election is nearing, and many smell huge money behind it.

The amendment to the Securities Markets Regulations 2007 has increased the paid-up capital by 6 times to Rs 3 billion from the existing Rs 50 million, the board confirmed, adding that other institutional investors, except the banks and financial institutions (BFIs), can also invest in the new exchange. At present, only banks, financial institutions, securities traders and listed organisations can invest in shares of the stock exchange. “Any private and public limited company can invest in the new stock exchange company that will be a complete private entity,” the amendment reads.

Likewise, the investor can hold up to 15 per cent of the shares in the new stock exchange, unlike the current rule of 10 per cent, according to the amendment. Investors can hold up to 15 per cent stakes in banks and financial institutions, and also insurance company. “Thus, the board has followed the banking and insurance regulator,” justified the board. However, an individual investor cannot invest.

There are two schools of thought on necessity new stock exchange; for a small market like Nepal. One claims that there is no need of another stock exchange, and the other claims that private stock exchange can make the current Nepal Stock Exchange (Nepse) more competitive.

Some business groups are lobbying for a new stock exchange, whereas the government has long been planning, without success, to divest its stakes in Nepse and make it a complete private entity. And providing licence for a new stock exchange before election also raises eye brows. Today, addressing a programme in Kathmandu, CPN Maoist (Centre) chair Puspa Kamal Dahal ‘Prachanda’ said that his party needs money to win election, and the capitalists has money.

“That’s why the controversial Janardan Sharma has been reappointed as finance minister for the second time, giving a clearance from the parliamentary probe committee after the CCTV scam on the night of budget,” informed a source at the Finance Ministry. “The purpose of giving clearance to Sharma and reappointment as finance minister will be seen in the days to come,” the source added.

The board, however, cites an expanding volume of the stock trading recently, and stakeholders demand to give license to a new stock exchange.

Currently, there is only one stock exchange, Nepal Stock Exchange (Nepse), where securities like stocks and bonds are traded. The Nepal Stock Exchange (Nepse) – also the front line regulator of securities trading in the country – has 58.66 per cent stake of the government, 14.60 er cent stake of Nepal Rastra Bank (NRB), 10 per cent stake of Employees Provident Fund (EPF), and 6.14 per cent of Rastriya Banijya Bank (RBB).

ग्रामीण क्षेत्रमा लघुबिमा आवश्यक

बिमा कम्पनीको मर्जरमा जोड दिएको बिमा समितिले लघुबिमा कम्पनीका लागि आवेदन खोलेको भन्दै विवाद बढेका बेला बिमा समितिले गत आर्थिक वर्षमा लक्ष्यअनुरुप बिमाको पहुँच विस्तार हुन नसकेका कारण लघुबिमा कम्पनीको आवश्यकता रहेको प्रष्टीकरण दिएको छ । सरकारले गत आर्थिक वर्षको बजेटमा कुल बिमाको दायरामा रहेको जनसंख्यामा लघुबिमाको हिस्सा १० प्रतिशत पु¥याउनुपर्ने लक्ष्य राखेको भए पनि लक्ष्य पूरा हुन नसकेको सोमबार समितिले पत्रकार सम्मेलनमा बताएको छ ।

गत आर्थिक वर्षमा भएका काम र चालू आवमा हुने नीति तथा कार्यक्रमहरु सार्वजनिक गर्दै समितिले ग्रामीण एवं दुर्गम भेगमा बसोबास गर्ने नागरिकले आफ्नो स–सानो रकमबाट आफू र आफ्नो परिवार, घर, व्यवसाय, खेतीपाती, पशुपन्छी, जडिबुटी लगायतको बिमा गरी जोखिम बिमा कम्पनीहरूलाई हस्तान्तरणको व्यवस्था गर्नु जरूरी रहेको बताएको छ । यसका लागि बिमा कम्पनीहरूलाई जिल्लासमेत तोकेर निश्चित लघुबिमा गर्न समितिले पटक पटक निर्देशन दिँदै आएको भए पनि लघुबिमा अपेक्षित रुपमा बढ्न नसकेको समितिका अध्यक्ष सूर्यप्रसाद सिलवालले बताए । 

कुल बिमाको दायरामा रहेको जनसंख्यामा उल्लेख्य मात्रामा वृद्धि भए पनि लघुबिमाको हिस्सा न्यून भएका कारण सरकारले दुर्गम, पिछडिएका र न्यून आय भएका वर्गमा बिमाको पहुँच पु¥याउने उद्देश्यले चालू आर्थिक वर्षको बजेट वक्तव्यमा लघुबिमा कम्पनी स्थापना गर्ने उल्लेख गरेको छ । सोही विषयलाई कार्यान्वयन गर्न र न्यून आय भएका तथा पिछडिएका सीमान्तकृत वर्गहरुको जीवन तथा सम्पत्तिको जोखिम विरुद्ध आर्थिक सरक्षा प्रदान गर्ने उद्देश्यले समितिले काठमाडौं उपत्यका बाहिर लघुबिमा कम्पनीको कार्यालय रहने गरी सातवटा प्रदेशमा एक एकवटा लघुबिमा कम्पनी स्थापना गर्न सूचना प्रकाशन गरिसकेको छ ।

नेपालजस्तो बाढी, पहिरो, भूकम्प, अतिवृष्टि जस्ता प्राकृतिक प्रकोपको सम्भावना बढी रहेको देशमा न्यून आय भएका र लक्षित वर्गको आर्थिक जोखिम हस्तान्तरणका लागि लघुबिमालाई सघन रूपमा देशव्यापी रूपमा अगाडि बढाउन लागिएको समितिको दाबी छ । यसबाट नागरिकले विपद्को समयमा हुने हानी नोक्सानीको क्षतिपूर्तिका लागि सरकारको अनुदान तथा राहतको भर पर्नुपर्ने अवस्थाबाट मुक्त भई बिमा कम्पनीहरूबाट नै क्षतिपूर्ति पाउने सुनिश्चित हुन्छ भन्ने समितिको विश्वास रहेको पनि जनाएको छ ।

चालू आर्थिक वर्षमा बिमा नियमावली, नीति तथा रणनीतिक योजना, बिमा सम्बन्धी कार्यविधि तथा ढाँचा र बिमा मार्गदर्शन एवं निर्देशिक तयार गर्ने तथा परिमार्जन गर्ने कार्यक्रम रहेको, एनएफआरएस १७ लागू गर्ने तथा जोखिममा आधारित पुँजी र जोखिममा आधारित निर्देशिका तयार पार्ने कार्यक्रम रहेको पनि समितिले जानकारी दियो । चालू आर्थिक वर्षमा बिमासम्बन्धी जनचेतना अभिवृद्धि गर्ने र बिमाको पहुँच विस्तारका लागि प्रदेश सरकार, स्थानीय तह, बिमा कम्पनी र आर्थिक पत्रकारहरूसँग अन्तरक्रिया गर्ने लगायतका कार्यक्रमहरुलाई निरन्तरता दिने समितिले जनाएको छ ।

राष्ट्रिय सूचना आयोग, वित्तीय क्षेत्रका नियामक निकायहरू, बीमकका अध्यक्ष, सञ्चालक र प्रमुख कार्यकारी अधिकृतहरू, कानुन व्यवसायी, बीमित, उद्योग वाणिज्य संघ, नेपाल चेम्बर अफ कमर्स लगायत सरोकारवालाहरूसँग समेत छलफल तथा अन्तरक्रिया गर्ने तथा चालू आर्थिक वर्षमा बिमासम्बन्धी जनचेतना अभिवृद्धिका लागि देशभर नै बिमा सम्बन्धी सचेतनामूलक कार्यक्रमहरू सञ्चालन गर्ने समितिको योजना रहेको पनि उनले बताए । बिमासम्बन्धी अन्तर्राष्ट्रिय गोष्ठीको आयोजना तथा माध्यमिक विद्यालय र सीटीईभीटीका पाठ्यक्रममा बिमा विषय थप गर्न आवश्यक कार्य गर्ने, बिमा सूचना केन्द्र स्थापना गर्ने, बीमित हित संरक्षण कोष स्थापना गर्ने, बिमा कलेज स्थापना गर्ने र बिमा सम्बन्धी अध्ययन अनुसन्धानलाई प्राथमिकताका साथ अगाडि बढाउने लगायतका कार्य चालू आर्थिक वर्षमा गरिने योजना पनि उनले सुनाए ।

बिमा समितिले बिमा व्यवसायको समग्र विकास एवं विस्तारमा जोड दिँदै आए पनि देशका ग्रामीण तथा दुर्गम भेगका जनतामा बिमाको पहुँच पुग्न सकेको छैन भन्दै समितिबाट विभिन्न स्थानीय तहहरूमा आयोजना गरेका कार्यक्रममा सहभागी स्थानीय बासिन्दाहरूबाट आफू र आफ्नो परिवारको बिमा गर्न नपाएको, घर, खेतीपाती, जडिबुटी, पशुपन्छी लगायतको बिमा गर्न नपाएको, बिमा कम्पनीहरू सहर केन्द्रित भएको, सदरमुकाममा रहेका बिमा कम्पनीका कार्यालयहरूले कृषि तथा पशुपन्छी बिमा गर्न नमानेको, बिमा दाबी भुक्तानी समयमा नपाएको जस्ता गुनासाहरु आउने गरेका कारण यसमा समितिले गम्भिरतापूर्वक समस्या समाधानको लागि पहल गर्ने पनि जनाएको छ ।

कोरोना बिमाको रकम अर्को साता 

बिमा समितिले कोरोना बिमाको रकम अर्को साता पाइने बताएको छ । सोमबार पत्रकार सम्मेलनमा समितिले कोरोना बिमाको दाबी भुक्तानी नपाएका बीमितले अर्को साता पैसा पाउने जनाएको हो । 

“कोरोना बिमाको पैसा अर्को हाप्ताभित्र आउन सक्ने सम्भावना बढी छ । हामीले अर्थ मन्त्रालयलाई कोरोना बिमाको पैसा तत्काल पठाउन आग्रह गरेका छौं । हालका लागि एक अर्ब पैसा पठाउन आग्रह गरेका छौं । यस विषयमा अर्थसचिवसँग छलफल भइसकेको छ,” बिमा समितिका अध्यक्ष सूर्यप्रसाद सिलवालले भने । सरकारले कोरोना बिमाबापत ११ अर्बभन्दा बढी रकम भुक्तानी गर्न बाँकी छ ।

घट्दै बिमा कम्पनी

बैंक तथा वित्तीय संस्थाको मर्जरको लहर पच्छयाउँदै बिमा कम्पनीहरु पनि मर्जरमा जान थालेका छन् । हिमालयन जनरल इन्स्योरेन्स कम्पनी र एभरेष्ट इन्स्योरेन्स कम्पनीबीच मर्जर भएर आइतबारबाट औपचारिक रुपमा एकीकृत कारोबार सुरु भएको छ । 

नेपाली बिमाको इतिहासमा पहिलोपटक दुई वटा बिमा कम्पनीहरु मर्जर भएर एकीकृत कारोबार सुरु गरेसँगै नेपाली बजारमा बिमा कम्पनीहरूको संख्या घट्ने भएको छ । हिमालयन जनरल इन्स्योरेन्स र एभरेष्ट इन्स्योरेन्स कम्पनीबीच मर्जर प्रक्रिया पूरा गरेर बिमा समितिले मर्जर स्वीकृति दिएसँगै आइतबारबाट एकीकृत कारोबार शुभारम्भ भएको हो । एकीकृत कारोबारको शुभारम्भ बिमा समितिका अध्यक्ष सूर्यप्रसाद सिलवालले औपचारिक रुपमा गर्दै बिमा कम्पनीहरुमा अस्वस्थ प्रतिष्पर्धा तथा अहिले कायम रहेको बिमा कम्पनीको पुँजीले बढ्दै गएको दायित्व वहन गर्न नसक्ने भएकाले बिमा कम्पनीको मर्जर जरुरी भएको बताए । उनले बिमा कम्पनीले पोलिसी बेच्ने तर पोलिसी अनुसार दायित्व वहन गर्न नसक्दा सिंगो बिमाको बजार बदनाम भएको तथा बिमा कम्पनीप्रतिको विश्वसनियतामा कमी भएकोले बिमा क्षेत्रमा धेरै सुधार गर्नुपर्ने आवश्यकता रहेको जिकिर गरे । नेपालमा कतिवटा बिमा कम्पनीहरु चाहिन्छ भनेर हालसम्म अध्ययन नै नभएको भन्दै उनले अब बिमा समितिले अध्ययन गर्ने बताए । 

अध्यक्ष सिलवालले सरकारले नै बिमा नबुझेको आरोप पनि लगाए । उनले सरकार र सरकारले गरेका अहिलेसम्मको लगानीको बिमा नभएको भन्दै चालू आर्थिक वर्षको बजेटमा बजेटको विषयमा धेरै कुराहरु समावेश भएर आएको र राष्ट्रिय बिमा नीति समेत मन्त्रालयमा ड्राफ्ट बनाएर दिएको बताए । 

कार्यक्रममा हिमालयन इन्स्योरेन्सका प्रमुख कार्यकारी अधिकृत विजयबहादुर साहले बिमा कम्पनीहरुले पुँजी वृद्धि गरेर मर्जरमा जाँदा बिमालाई सुधार र उचाइ बढाउने दाबी गरे । हिमालयन र एभरेष्ट दुवै कम्पनीको गत असार २ गते सम्पन्न विशेष साधारणसभाबाट मर्जरसम्बन्धी सम्पूर्ण प्रक्रिया पारित भएका थिए । बिमा समितिले यी दुवै कम्पनीको मर्जरलाई गत असार ८ गते अन्तिम स्वीकृति प्रदान गरेको थियो । दुई संस्थाको मर्जर हुने अन्तिम दिनसम्म कायम रहने सम्पूर्ण सम्पत्ति र दायित्वहरु नयाँ बन्ने संस्था हिमालयन एभरेष्ट इन्स्योरेन्सले स्वीकार्ने गरी गत असार २३ गते स्वीकृति प्राप्त भएको थियो । दुवै बिमा कम्पनीबीच गत वैशाख २२ गते मर्जरमा जाने प्रारम्भिक सम्झौतामा हस्ताक्षर भएको थियो । मर्जरपछि कम्पनीको चुक्ता पुँजी २ अर्ब ४२ करोड ८१ लाख रुपैयाँ पुगेको छ । 

बिमा समितिबाट क समयमा भटाभर छुट लगायत विभिन्न सेवा सुविधा पाउने आशले कम्पनीहरुले अन्तिम मर्जरको लागि सम्झौता गरेका छन् । जसका कारण पुनर्बिमा कम्पनी बाहेक ३९ वटा बिमा कम्पनीहरुमध्ये १९ वटा कम्पनी मर्जरमा जाने भएका छन् । असार महिनामा निर्जीवन बिमाका १० वटा र जीवन बिमाका ९ वटा कम्पनीले मर्जरमा जान प्रारम्भिक समझदारीपत्रमा हस्ताक्षर गरिसकेका छन् । 

मर्जरमा जाने तयारी गरेका निर्जीवन बिमा कम्पनीमा एभरेष्ट, प्रिमियर, सगरमाथा, लुम्बिनी जनरल, सिद्धार्थ, जनरल र सानिमा जनरल इन्स्योरेन्स तथा प्रभु र अजोड इन्स्योरेन्समध्ये सिद्धार्थ इन्स्योरेन्स र प्रिमियर इन्स्योरेन्सबीच मर्जरमा जाने सहमति भइसकेको छ । मर्जपछि सिद्धार्थ प्रिमियर इन्स्योरेन्सको नामबाट एकीकृत कारोबार गर्ने गरी दुई कम्पनीबीच सहमति भएको छ । सानिमा जनरल र जनरल इन्स्योरेन्सबीच सानिमा जनरल इन्स्योरेन्सको नाम रहने गरी मर्जर सम्झौता भएको छ । सगरमाथा इन्स्योरेन्स र लुम्बिनी जनरल इन्स्योरेन्स पनि १०० बराबर ८० को स्वाप रेसियोमा मर्जरमा जाने भएका छन् । त्यस्तै, प्रभु र अजोड इन्स्योरेन्सले मर्जरमा जानको लागि सम्झौता गरेका छन् । 

यस्तै, जीवन बिमातर्फ ९ वटा कम्पनीले मर्जरमा जानको प्रारम्भिक समझदारी गरिसकेका छन् । जसमा प्रभु र महालक्ष्मी लाइफ, सूर्या र ज्योति लाइफ, रिलायन्स र सानिमा लाइफसहित प्राइम, गुराँस र यूनियन लाइफले एक आपसमा मर्जरमा जानको लागि पहिलो चरणमा सम्झौता गरेका हुन् । 

कम्पनीहरु मर्जरमा जानुको कारण समितिले चुक्ता पुँजीमा गरेको वृद्धि नै हो । बिमा समितिले निर्जीवन बिमा कम्पनीको न्यूनतम पुँजी साढे २ अर्ब रुपैयाँ र जीवन बिमा कम्पनीको न्यूनतम चुक्ता पुँजी ५ अर्ब पु¥याउने व्यवस्था गरेको छ । जसको लागि पहिलो प्राथमिकतामा मर्जर नै थियो । यद्यपि पुँजी पु¥याउनकै लागि गरिएको मर्जरपछि बन्ने अधिकांश कम्पनीहरुको चुक्ता पुँजी भने पुगेको छैन । बिमा समितिले तोकिएको पुँजी पु¥याउनको लागि कम्पनीहरुलाई आगामी चैतसम्मको समय दिएको छ । उक्त समयभित्रमा मर्जरमा गएका कम्पनीहरुले हकप्रद तथा बोनस सेयरमार्फत न्यूनतम पुँजी पु¥याउन सक्ने छन् । 

तर, बिमा कम्पनीको मर्जर सम्झौताले उनीहरुको सेयर कारोबार बन्द भएको छ । जसका कारण सेयर लगानीकर्ताको १ खर्ब २४ अर्ब २४ करोड ९१ लाख बन्धक भएको छ । बिमा कम्पनी मर्जरमा गएसँगै लगानीकर्ताको सम्पत्ति बन्धक बनाइनु उचित नहुने नेपाल उद्योग वाणिज्य महासंघको पुँजीबजार फोरमका सभापति अम्बिका प्रसाद पौडेल बताउँछन् । तर, नेपाल धितोपत्र बोर्ड (सेबोन)का अध्यक्ष रमेशकुमार हमाल भने मर्जरमा जाने कम्पनीहरुको दोस्रो बजार कारोबार निश्चित अवधिका लागि रोक्का हुनुपर्ने बताउँछन् ।

आइतबार हिमालयन जनरल र एभरेष्ट इन्स्योरेन्सबीचको मर्जरपछि बनेको हिमालयन एभरेष्ट इन्स्योरेन्सको एकीकृत कारोबार शुभारम्भ समारोहलाई सम्बोधन गर्दै अध्यक्ष हमालले मर्जर प्रयोजनका लागि हुने कारोबार रोक्का गरिने सेयरधनीको हितमै हुने दाबी गरे । कारोबार लामो समय नराकियोस् भनेर धितोपत्र बोर्ड र हालै गठित टास्क फोर्सले काम गरिरहेको उल्लेख गर्दै हमालले यस विषयमा चाँडै केही सहज व्यवस्था आउने पनि बताए । 

Finance Ministry directs to settle Covid insurance claims within a week

 After huge public outcry about the non-payment of compensation from insurance companies, the Finance Ministry today directed to the insurance sector regulator to settle Covid-19 insurance claims of the claimants within a week of verifying their positive polymerase chain reaction (PCR) tests.

During a meeting held at the Finance Ministry, Finance Minister Bishnu Poudel directed the Insurance Board and Nepal Insurers’ Association (NIA) to settle the claims within seven days. During the meeting, the minister also directed them to establish a hotline number and help desk services to register complaints.

The minister directed – both the Insurance Board chair Chiranjibi Chapagain and Nepal Insurers’ Association president Dip Prakash Pandey -- to settle the claims without any unnecessary delay, though the ministry and Insurance Board should have taken action against the insurance companies for not settling the claims.

The meeting – also attended by the finance secretary Shishir Kumar Dhungana and revenue secretary Ram Sharan Pudasaini – also decided that the Insurance Board to coordinate and monitor the situation of Covid-19 insurance claims and settlement and submit a daily progress report to the ministry.

The Coronavirus Insurance Programme has been announced by the government in the budget for the current fiscal year. But, the programme courted controversy after non-life insurance companies decided not to sell the policy as the amount to be paid in claims will be very high.

However, the Insurance Board directed non-life insurance company to give continuity to the coronavirus insurance scheme after the government’s assurance to share the risk with the insurance companies.

Meanwhile, Indian ambassador to Nepal Vinay Mohan Kwatra also paid a courtesy call to finance minister Poudel today. Ambassador Kwatra, on the occasion, handed over a cheque of Rs 1 billion for housing reconstruction projects in Gorkha and Nuwakot that are being supported by India.

The insurance companies sold Covid-19 policies that covers up to Rs 100, 000. As the number of Covid-19 cases increased, the insurance companies failed to settle the claims.

General Insurance allots primary shares

 General Insurance Company Ltd allotted its Initial Public Offering (IPO) and some 273,000 applicants got 10 units each.

The remaining 521,546 investors, who subscribed to the offering did not get any shares, according to the non-life insurance company.

The issue manager of the General Insurance Company Ltd allotted the primary shares through a lottery today after the public offering was oversubscribed by over seven times, the company informed, adding that out of three million ordinary shares allocated for the public to collect Rs 300 million, some 2.73 million units were allotted for the public while the remaining have been provisioned for staff and mutual funds. “Out of the 2.73 million units of shares for the public, the IPO drew some 794,546 valid applicants applying 21.41 million units of shares.”

Insurance coverage of farm sectors up

Insurance coverage in agricultural products increased by 58 per cent in the last fiscal year.
The Insurance Board attributed the surge to the government subsidy as the government currently offers subsidy equivalent to 75 per cent of the premium amount to encourage farmers to insure their farm products.
The insurance companies sold insurance policies worth Rs 18.72 billion in agricultural products in the last fiscal year 2018-19, compared to the insurance policies of Rs 11.85 billion a fiscal year ago in 2017-18, according to the board that revealed that the insured amount has increased fourfold in the past five years.
Last fiscal year, non-life insurance companies collected Rs 631.44 million in premiums, up from Rs 510.93 million a fiscal year ago. “Over the period, the insurers issued 101,152 policies, some 73 per cent more compared to a fiscal year ago.”
The government – through the budget for the fiscal year 2014-15 – had announced providing 75 per cent subsidy in the premium of agriculture insurance to farmers.
According to the board, the government provided premium subsidies totalling Rs 631.44 million to farmers in the fiscal year 2018-19. “The subsidy was 65 per cent more than the amount a fiscal year ago,” the board claimed, adding that the board made it mandatory for non-life insurers to provide agriculture insurance services, assigning them certain districts to carry out the business due to low coverage.
The board has enforced over two dozens of distinct insurance policies to cover major livestock and crops – including ginger, coffee, paddy, mushroom, potato, sugarcane, seed, vegetable, turmeric, cardamom, banana, cattle, fish, poultry and goat – produced in the country.
Likewise, farmers can claim insurance, if their crop or livestock is damaged from fire, lightning, earthquake, flood, inundation, drought, landslide, tornado, hailstorm and snowfall. They can also claim insurance for losses due to pest and disease, the board added.
According to the board, the share of crop insurance is still negligible compared to insuring livestock. In the last fiscal year, farmers purchased policies in crop insurance amounting to Rs 834.58 million, which stood at only 4.7 per cent of the total insured amount in farm products. “In the crop insurance, farmers purchased policies worth Rs 547.39 million to cover risks in fruit production.”

Three more firms get Insurance licence

Three more life insurance companies have obtained operating licence from the Insurance Board today.
The insurance sector regulator granted Sun Nepal Life Insurance, Reliance Life Insurance and Reliable Life Insurance, according to Insurance Board (IB).
Altogether six new life insurance companies have obtained the operating licence since the the board resumed granting licence to the companies, whose applications were pending since long.
Earlier the board had granted operating licence to three life insurance companies including IME Life Insurance, Union Life and Jyoti Insurance, making a total of six new players. The entry of new life insurance companies in the market has made a total number of life insurance companies in the country to 15.
After increasing the paid-up capital requirement through the ‘Directives on Insurer Registration and Insurance Business Operation’ to Rs 2 billion and Rs 1 billion for life and non-life insurance companies, respectively, the insurance sector regulator has started granting licence. The companies that had submitted applications in the fiscal year 2007-08 were given three weeks’ time to resubmit applications with new capital requirement.
Earlier, Life Insurance companies need to have Rs 500 million paid-up capital and Rs 250 million for non-life firms.
Meanwhile, the board is also planning process for non-life insurance companies. The board has received four applications – from General Insurance, Sanima Insurance, Ajod Insurance and Manakamana Insurance – for the operating licence of non-life insurance companies.
There are currently 17 non-life insurance companies in operation in Nepal.

Insurance Board cuts cost of riot, protest insurance products down

Insurance Board (IB) – the insurance sector regulator – has reduced premiums on insurance products that cover damages inflicted by riots, strike, malicious attacks and sabotage terrorism by up to 50 per cent.
The new premium rates will come into effect on July 16. The board had made it mandatory for those buying insurance products to protect themselves from risks related to riots, strikes and acts of terror after the Maoist insurgency reached its peak. The regulator has now reduced the premium on coverage of these risks following decline in the number of such violent incidents.
According to the board's director Shree Man Karki, the board had revised the premium rates to relieve customers from extra financial burden, as cases of riots, protests and acts of terrorism are not heard very often.
The board has reduced premium on riot and strike insurance coverage for private and commercial buildings to 0.02 per cent of the coverage amount from 0.026 per cent of the coverage amount.
Similarly, premiums on riot and strike insurance coverage for warehouses range from 0.035 per cent to 0.060 per cent of the coverage amount.
Previously, the premiums on these products ranged between 0.044 per cent to 0.08 per cent. Premium on riot and strike coverage for factories, on the other hand, has been reduced to 0.04 per cent from 0.05 per cent of the coverage amount.
Likewise, premium on riot and strike coverage for shops has been reduced to 0.08 per cent down from 0.104 per cent of the coverage amount.
For movie theatres, exhibition halls and parks, premium has been brought down to 0.05 per cent of the coverage amount – down from 0.07 per cent – while media houses and telecom companies have to pay a premium of 0.035 per cent of the coverage amount – down from 0.044 per cent – to protect their assets from risks related to riot and strike.
The board has also revised premiums on riot and strike insurance coverage for power houses, electricity transmission and distribution systems, and buildings under construction.
As per the revised rate, power houses and electricity transmission and distribution systems will have to pay a premium of 0.035 per cent of the coverage amount, while buildings under construction will have to pay premium of 0.02 per cent of the coverage amount.
Likewise, the board has reduced the premium for malicious damage under fire insurance policy to 0.05 per cent of the coverage amount.
The board has also fixed the premium for household insurance at 0.1 per cent of the coverage amount.
Meanwhile, the Insurance Board has also revised premium on personal accident insurance coverage. From July 16, personal accident insurance product with coverage of up to Rs 2 million can be bought upon paying 0.01 per cent of the coverage amount. Currently, this premium rate is only applicable for personal accident insurance with coverage of up to Rs 1 million. 

Insurance Board hikes accident cover for passengers

Introducing a new motor vehicle insurance tariff policy, Insurance Board (IB) has increased the premium for third party motor insurance policy as well as the minimum coverage effective from the next fiscal year.
Revising the motor insurance tariff directives, the board has hiked the insurance coverage amount by five times in the case of death of passengers in vehicle accidents, effective from the beginning of the next fiscal year.
Issuing the amended Directive on Motor Insurance Rate, the regulatory authority of the insurance sector has increased the coverage to Rs 500,000 per person from current Rs 100,000. Currently, third party – those not in the vehicles – gets a coverage of Rs 500,000.
The board said the provision is applicable to passengers in all types of public and private vehicles; four-wheeler, three-wheeler and two-wheeler.
Premium, however, differs with the capacity of motorbikes. To purchase the new insurance policies, owners of two-wheeler with engine capacity of less than 150cc will have to pay annual premium of Rs 1,500, excluding taxes. For owners of two-wheeler with engine capacity of 150-250 cc, the annual premium has been fixed at Rs 1,700 (excluding taxes), while owners of two-wheeler with engine capacity of over 250 cc have to deposit premium of Rs 1,900 (excluding taxes) per year, according to the board.
“If existing policyholders wish to upgrade to the new policy, they can do so by paying some extra fee," IB Director Shree Man Karki said, adding, "but it has to be done within the month of Shrawan (July 16 to August 16). "The insurance companies have already been notified."
The latest revision made to the premium rates, however, has not brought about changes in third-party liability coverage."
Third-party insurance enables policyholders to claim for compensation if their vehicles kill or injure people or damage properties during road accidents.
Currently, owners of two-wheeler can claim for up to Rs 5 million in compensation from insurance companies under third-party liability. This includes compensation of up to Rs 2.5 million to cover losses of human lives or cover medical expenses of people injured in the accident.
Compensation of another Rs 2.5 million is provided to restore properties damaged during accidents.
Karki said the new provision is in line with the budget announcement. "Under the vehicle insurance, a similar provision of third party insurance will be made to insure the passengers travelling in public vehicles,” the budget for 2016-17 had announced.
Likewise, the board has doubled the compensation for performing last ritual of an accident victim to Rs 50,000. Earlier the compensation amount was Rs 25,000. It has also raised the medical insurance of the injured to Rs 300,000 per person from current Rs 5,000.
A caretaker of the wounded will receive Rs 500 daily for 45 days from previous 30 days, according to the amendment.
The new provision has maintained the third-party insurance at Rs 500,000, while the insurance coverage ceiling for medical treatment has been raised to Rs 300,000 from current Rs 200,000. All types of vehicles, including ambulance, used to transport the wounded to the hospital will be provided Rs 10,000.
Karki also said that the board has introduced the 'knock for knock' system. "If two vehicles collide, insurers will have to bear the cost for maintaining the vehicles concerned,” according to the new directive.
In case of passengers’ death in such collision, compensation of crew member and riders will be drawn from the insurance coverage of the vehicles concerned. "The insurer will have to be reimbursed the amount from the insurer of the other vehicle which is found guilty for the accident.”
Third-party vehicle facing loss due an accident will be provided the repairing cost without depreciation provision.
However, the board has not made any insurance coverage provision for a third person in a two-wheeler. "Only the driver and a pillion rider of a motorbike will be provided the insurance coverage of Rs 500,000,” the directive reads, adding that a child of less than one year of age would receive 25 per cent of the insurance policy amount, while a child of 1-5 years of age would be provided 50 per cent of the policy amount.
"If the treatment of an injured person is done in foreign countries, including India, the family members concerned will have to inform the insurer in a week," Karki said, adding that the provision has been enforced to discourage the practice of producing fake bills to receive hefty sum for treatment coverage.
According to the new directives, the premium fee of motor insurance has been increased in line with the coverage amount. While owners of motorbike will have to pay additional Rs 500 per year for insurance, automobile owners will have to pay total premium of Rs 700 per seat. Compensation covering ambulance cost of Rs 10,000 to take the injured person to the hospital, and Rs 500 per day for up to 45 days for the attendant of the injured person and 25 per cent discount on premium for disabled-friendly motorbikes are some of the highlights of the new directive.
The liabilities of motorbike alone stand at Rs 1.6 million. However, the premium has been increased by only Rs 500. It means owners of two-wheeler can insulate themselves with insurance coverage of over Rs 6.6 million by paying a premium of as little as Rs 1,500 per year, according to the Motor Insurance Premium Directive.
Insurance companies can, however, deny to these payments, if policyholders were found to be driving under influence or if accidents were premeditated.

Intra-day transaction hits record Rs 2.2 billion

Transaction sailed past the Rs 2-billion mark for the first time in the history of domestic share market today to hit an all-time high of Rs 2.2 billion.
Likewise, insurance companies and banks propelled the stock market not only to record the highest intra-day transaction today at the Nepal Stock Exchange (Nepse) but also pushed Nepse index to a record high of 1,614.15 points, up by 4.56 points or 0.28 per cent from yesterday.
With bullish trend in recent months, the stock market has been observing daily transactions of over Rs 1 billion for the last 20 days.
The stock market analysts attribute high demand for insurance and microfinance stocks in particular coupled with excess liquidity with banks and financial institutions for the upswing in the market.
Of the total trading volume, some 22 per cent or Rs 400 million transaction was recorded pf the promoter shares of Nepal Insurance Company. Likewise, large volumes of shares of Nepal Bangladesh Bank, Rural Microfinance Development Centre, Standard Chartered Bank Nepal and Everest Bank also traded hands today.
Similarly, biggest gainers of today were Bhargav Bikash Bank, Bottlers Nepal (Terai), Vijaya Laghubitta Bittiya Sanstha, Butwal Power Company and ILFCO Microfinance Bittiya Sanstha.
The rush to buy shares of insurance companies and also banks and financial institutions started after the Insurance Board and central bank instructed them to jack up their capital base. The banks have to increase their paid up capital to Rs 8 billion, whereas the Insurance board has asked life insurance companies to increase their capital base to Rs 5 billion from current Rs 500 million and non-life insurance companies to Rs 4 billion from current Rs 250 million.
Likewise, the market capitalisation also reached Rs 1,740 billion today, which is almost 80 per cent of the gross domestic production (GDP) of the country.
The share market trading that used to hover around million rupees per day has lately started to skyrocket because of fully automated share trading that fastened the securities ownership transfer and clearance services, the analysts claim.
The use of dematerialised stocks has enabled investors, who buy shares in bulk, to slice them in smaller portions before selling and profit booking, they said, adding that earlier investors used to buy shares – paper scrips – in bulk, used to pay split charges and wait for almost a month before selling them in small volumes. "With the introduction of dematerialised stocks, investors do not have to wait for long time to sell after splitting them, which has helped raise trading volume and transactions both.