Kathmandu: Nepal’s first credit rating agency ICRA Nepal is planning to deliver specialized services to insurance companies. As the risk in business of insurance industry is growing with the growth of business, the rating agency has announce to offer credit rating for ‘Claims Paying Ability of Insurance Companies’ and ‘Insurance Financial Strength Rating’.
The annual report of ICRA group for FY 2020-21,states that the service will be available in near future. There are only two credit rating agencies in Nepal i.e. ICRA Nepal and CARE Rating Nepal. Both are joint ventures of Indian Credit Rating Group.
Nepal’s insurance sectors business is in growth phase. With the added number of insurance companies, insurance industry has witnessed tough competition. Some insurers are found involved in ill practice to get new business.
With the credit rating of claim paying ability and financial strength, policyholders can make better decision while choosing their insurer. The claim paying ability of an insurance company is an important perspective to judge the quality of service provided by the insurance company. Higher claim payment ratio is supposed to be beneficial for the insured as they get timely payment against their insurance claim.
Currently, there are 19 life insurance companies and 20 non-life insurance companies.