Kathmandu: A study conducted by the Insurance Board has made the findings that insurance companies have not met the mandatory target of 10 percent for micro insurance policy sales. According to the study report, insurance companies have done only upto 3 percent on their insurance sales business.
Companies are required to have 10 percent of their total business in microfinance. Last year, the share of micro insurance was not below 1 percent, but after the IB’s threaten to penalize insurers, the sales of micro insurance is gradually increasing. Though its still within 3 percent. The regulatory authority has decided to fine and take action against the companies that do not meet the target of 10 percent as per the directive this year as well.
Although some life insurance companies have issued micro-insurance policies collectively through women’s groups, microfinance, NGOs, INGOs, non-life insurance companies have not been able to do so. Life insurance companies have issued term insurance policies based on the Micro Insurance Directive, 2076.The non-life insurance companies, however, have not sold micro-insurance.
Surya Prasad Silwal, chairman of the Insurance Board, is of the view that the concept of micro-insurance has to be promoted on a large scale to serve a large number of people below the poverty line.