Kathmandu: The directors of the insurance companies have demanded to conduct training two or three times a year. Such request made to the Insurance Board during an interaction program held with the chairpersons of all life insurance companies on Tuesday.
During the discussion, IB has requested the chairpersons to give time for the company as well. It has asked the directors and chairpersons to attend the meeting only and not to provide general information about the company’s operations.
The directors and chairmen of some companies pass the proposal put forward by the chief executive officer. Therefore, the IB suggested that the BODs should be vigilant in all the activities of their company.
Most promoters or directors do not even have general knowledge of insurance. Insurance is a technical issue in itself. In this context, the directors have demanded the IB to conduct orientation program twice or thrice a year for them. Nepal Rastra Bank has also been organizing basic education program for newly appointed directors in banks and financial institutions.
Directors who do not even have general knowledge of insurance cannot do anything other than signing and receiving the meeting allowance. The IB has made arrangements for all the members of BOD to sign the Actual Valuation and Audit Report on each page. Even though such a provision has been made to read at least the things written in the report, the BODs have been signing without understanding the technical and financial contents. Without even a basic knowledge of insurance indicators, they cannot question top management and auditors.
In some companies, there is extreme interference from the CEO and the Chairperson, but in most companies, the managers are completely dependent on the top management. Top management is able to hide some mistakes. There is a provision that there should be at least one expert in the post of director, but the major shareholders have also kept people close to them in the post of director. Such an arrangement has been made so that an expert director can help even if other operators do not understand.
Insurance companies can do better only if they provide good information about the importance of the company’s position and its role. The chairperson and moderator have the biggest role in making policies, rules and regulations. The board has instructed the chairpersons to be vigilant while making such rules. .