Kathmandu: While banks and financial institutions are distributing bonuses in advance to their employees, the employees of life insurance companies have not been able to get bonus even after two to three years of completion of FY.
Due to untimely financial audit, the employees of the life insurance companies have not been able to get the bonus against the profit earned by their company.
Banks and financial institutions have been holding AGM within six months of the end of the FY, so some amount is distributed during the FY or Dashain Festival and the remaining amount is distributed after the AGM.
At present, the employees of banks and financial institutions are focused on collecting bonus in advance, but the employees of insurance companies have been waiting for the bonus for the last two or three years.
Insurance companies cannot distribute bonuse in advance as there is a big difference between the audited financial report and the financial report after the actuarial valuation.
Some new life insurance companies have shown losses after actuarial valuation. According to the unrefined financial statement, if the bonus is paid in advance, the employees can’t be compelled to return the bonus if the company is found in loss after actuarial valuation.
As a rule, employees receive a 10 percent bonus on profits.Not all life insurance companies have completed the audit of the previous fiscal year 2076/77. Some has yet to complete the audit and AGM of the FY 2075/76.
Employees of Rastriya Beema Sansthan and the Rastiry Beema Company had not been able to receive bonuses for decades. In coordination with the Insurance Board and the Ministry of Finance, some amount has been distributed in advance since last year.
Other insurance companies are also refusing to pay bonus in advance due to employee turnover.