Kathmandu: The proposed insurance bill includes a provision to establish a separate fund for the protection of policyholders’ interests. The government aims to set up the fund with the money that has been remained unclaimed with the insurance companies for a long period.
The proposed bill includes a provision to establish policyholders’ welfare fund under the Insurance Authority. The Authority has been proposed as the regulatory authority for insurance industry.
For the first time in Nepal, a policyholders’ fund is being established. In neighboring India, insurance companies have been required to deposit money in the Senior Citizens’ Welfare Fund set up by the government.
The proposed insurance bill does not specify the duration after which the amount will be deposited in the insurance fund. However, in general, when the insured cannot be identified, the insurance claimant does not come in contact, due to court decision or legal impediment, the claim which has not been settled for almost two decades will be transferred to the fund.
Provision is being made to deposit not only the amount of the long unpaid claims but also contribution of certain percentage amount in the fund by the Insurers annually. Apart from this, the Insurance Authority will also allocate a certain percentage for the fund. Until now, insurers have been earning interest or profit by investing such amount themselves.
The Insurance Authority will prepare rules and directives regarding the operation of the Fund. The government aims to use the money collected from the establishment of the Fund to provide free insurance to the citizens of deprived communities and to run various welfare programs related to the protection of the interests of the insured.
Report on Insurance Bill submitted to the House of Representatives After 17 rounds of discussions, the Finance Committee of the Parliament has submitted the report of the Committee on Insurance Bill, 2079 BS to the House of Representatives on June 16. Committee Chairman Krishna Prasad Dahal presented the report at the 11th session of the House of Representatives.