Kathmandu: The Insurance Industry will be fully implementing the anti-money laundering(AML) reporting system by 16 August 2021.
Based on the suggestion of National Risk Assessment Report(NRA) 2020, the Insurance Board has made it mandatory to implement goAml(a web based anti-money laundering reporting system). Now, both life and non-life insurance companies have to install a customized software for AML compliance.
The NRA report has mentioned that insurance industry has medium risk of AML/CFT. It has mentioned that the growing demand for the single premium payment policy may be used as the tools for the AML. Based on the suggestion of NRA, Insurance Board has made amendments to the provision of surrender and policy loan provisions for the single premium policy. Now, the surrender value can be obtained only after 3 years of policy issue. Earlier the surrender value was available after 30 days of policy issue.
Insurance Board has already implemented ‘Money Laundering and Financing Terrorism Acts Prevention Directives 2075’ for the insurance industry.
There’s a provision of periodical reporting to Financial Intelligence Unit(FIU) Nepal against the transaction of above Rs.1 lakh within 15 days of such transactions. Similarly, any inward payment of Rs.1 lakh or above must be made through banking channel, digital medium or cheque.
Similarly, any outward payment of Rs.50 thousand or above must be made directly to the bank account of the beneficiary.
There’s a provision of identifying the politically exposed person or high level authority and reporting the same. The directives has the provision of KYC, details KYC and due diligence reporting(DDR) as suggested by the anti money laundering and financial terrorism act prevention law 2064 and and by-law 2073.
As per the ‘Life Insurance Policy Directives 2078’ proof of of source of income disclosure must be submitted for new policy with the first premium of Rs.5 lakh or above.