Kathmandu: The Insurance Board (IB) has fined 11 insurance companies for delay in preparation and approval of financial audit report. The regulatory authority has fined state-owned insurers Rastriya Beema Sansthan, Rastriya Beema Company, India joint ventures The Oriental Insurance and National Insurance, Nepal Life Insurance, Guransh Life Insurance, IME Life Insurance, Reliable Life Insurance, Union Life Insurance, Sun Nepal Life Insurance, Sanima Life Insurance.
According to a press release issued by the IB, these companies have been fined Rs. 10,000 each. As per the clause 25 of the Insurance Act 2049, an insurance company must submit the financial audit report of a Financial Year within 10 months of completion of the FY. But these 11 companies have been failure to submit their financial audit report of FY 2076/77(2019-20).
These life insurers have expressed their dissatisfaction over the action taken by the regulatory authority. They have claimed that the IB too is responsible for the delay. The insurers have admitted that despite their honest attempt to prepare and approve their financial report on time, it has been delayed due to the issue of actuarial valuation. The insurers have been claiming that the limited number of the actuaries is one of the major reason behind the delay in the preparation of financial report for a life insurer. The state-owned Rastriya Beema Sanshtan(Life Insurer) and Rastriya Beema Company(General Insurer) have not been able to conduct their annual general meeting for last five years.
Due to the implementation of Nepal Financial Reporting System (NFRS) and other provisions, the delay in the preparation of financial report of FY 2075/76 was genuine but after the full implementation of the NFRS, still some insurers are seeking excuses, a senior officer of the IB commented on the condition of anonymity.