Kathmandu: Out of the total 39 insurance companies, only 24 insurance companies have been able to submitted their capital increment plan within the deadline. Rest insurance companies have missed today’s deadline to submit the capital plan.
Among life insurers, Surya Life, National Life, Asian Life, Mahalakshmi Life, MetLife, LIC Nepal, Sanima Life, Citizen Life, Gurans Life, Reliance Life, Sun Nepal Life and IME Life have submitted capital increment plan.
The non-life insurance companies Sanima General, IME General, Everest Insurance, Prudential, NECO, Lumbini General, Shikhar, Nepal Insurance, Sagarmatha Insurance, Ajod Insurance, General Insurance and United Insurance have submitted their plan for capital increment.
First issuing a circular and later amending the Directives on Formation of Insurance Company, the IB has doubled the regulatory capital. According to the new provision, life insurers must maintain at least Rs.5 billion and non-life insurers Rs.2.5billion paid up capital within a year. There are 39 insurance companies including 19 life insurers. Out of the total 39 insurer, Metlife insurance is the branch office for Nepal.
It has been learnt that the Board will penalize the companies and extend the deadline to submit the plan. 14 insurance companies, state-owned Rastriya Beema Sansthan, Prime Life, Union Life, Jyoti Life, Reliable Nepal Life and Prabhu Life Insurance and non life insurers Oriental Insurance, National Insurance, Himalayan General, Premier Insurance, Prabhu Insurance, NLG Insurance, Siddhartha Insurance and Rastriya Beema Sansthan have been failure to submit their capital for regulatory capital increment.
It has been learnt that The Insurance Board will slap penalty and will provide a new deadline to the remaining companies to submit their plan.
The chairman of the IB has publicly announced that the circular on regulatory capital increment has been introduced with the intention to limit the number of insurers and increase the financial strength. He has also admitted that any insurer, failure to meet the regulatory requirement for capital, will be forced to merge.
