Kathmandu: Nepal Life Insurance and National Life Insurance Company are two major leading life insurance companies in the domestic market. They occupy a major chunk of the total market share. In terms of market share Nepal Life Insurance is the market leader.In recent days, National Life Insurance is taking place in terms of business and profitability growth. Here, we have presented the comparison between these two companies based on the first quarter financial statements of Financial Year 2078/79:
On the basis of paid up capital: The paid up capital of Nepal Life is Rs.7.19 billion while the paid up capital of National Life is Rs. 3.39 billion. During the review period, paid up capital of Nepal Life increased by 31 percent and paid up capital of National Life increased by 10 percent.
On the basis of reserve fund: Nepal Life has accumulated Rs. 869.6 million in reserve fund while National Life has accumulated Rs. 965 million in reserve. The reserve of Nepal Life has decreased sharply by 76.29 percent while that of National Life has decreased by 15.94 percent.
Life Insurance Fund: Nepal Life has a life insurance fund of Rs. 118 billion and National Life has a life insurance fund of Rs. 44.89 billion. The life insurance fund of Nepal Life has increased by 25.25 percent while that of National Life has increased by 24.90 percent. The life insurance fund growth rate remains almost the same for both companies. Life insurance funds are supposed to be very crucial for life insurance companies.
Earnings of net premiums: In the first three months of the current Fiscal Year, the net premium income of Nepal Life has increased by 9.21 percent to Rs. 9.74 billion while the net premiums of National Life increased by 23.01 percent to Rs. 3.44 billion. Here, the premium income growth of National Life is quite higher than of Nepal Life.
Net profit: The net profit of Nepal Life has declined by 96.93 percent to Rs.70.33 million while the net profit of National Life has decreased by 26.72 percent and reached Rs.86.7 million. Here, National Life Insurance is still strong in terms of profit generation despite of decline in profit as compared to the first quarter of the last financial year. However, in the case of life insurance companies, the actual profit will be ensured only after the actuarial valuation as the actuarial valuation is yet to take place.
Earnings per share: The annualized earnings per share(EPS) of Nepal Life is 39 paise only while the annualized earnings per share of National Life is Rs.10.23.
Book Value: The book value of Nepal Life is Rs. 120 while that of National Life is Rs. 137.
Market Price: The current market price, the market price of Nepal Life is Rs.1603 and that of National Life is Rs.1040.
These comparisons are only for investors awareness but not a complete analysis for investment purposes.Investors are suggested to go for adequate analysis before making any investment in stock.