Kathmandu: The Insurance Board(IB)has formed a committee to study about the re-insurance circular. The committee has been formed under the chairmanship of Rajuraman Poudel, executive director of the IB.
The members of the committee include IBs director Shushildev Subedi, two representatives from non-life insurance companies, one representative from life insurance companies and one representative from each re-insurance company.
The recent circular regarding 100 percent mandatory cession to domestic Re-insurance Companies of the IB has been widely criticized. The study committee is expected to recommend an amicable solution.
The insurers have admitted that they are ready to offer re-insurance business to domestic re-insurers upto the limit of their risk bearing capacity only. However, bot theife and non life insurers have been requesting the IB to withdraw it recent circular regarding mandatory cession.
Some foreign reinsurance companies have been delaying the payment of outstanding claims following the IBs directive.