Kathmandu: The House of Representative (HoR) has passed the “Insurance Bill 2079″. The proposal to pass the Insurance Bill 2079 presented by Finance Minister Janardan Sharma in Parliament has been passed with majority of HOR.
The proposal to make the clauses 1 to 124 of the Insurance Bill submitted to the Parliament by the Finance Committee on Asar 2nd has been passed by the HoR. If the HoR passed the said proposal, the proposal that clauses from 1 to 172 and the schedule should also be part of the amendment bill has been passed for decision.
The Bill was registered in the HoR four years ago by the then Finance Minister Yuvraj Khatiwada.
Now, the Bill will be forwarded to upper house, National Assembly for approval. Once, the National Assembly passes the Bill, it will be made public by the President and implemented after publication in the Gazette.
The Bill has the provision of conversion of existing structure of the Insurance Board of Nepal to Insurance Authority. The Government claims that the new Bill will empower the Insurance Board for better regulation and control.
The Major Provisions in The Proposed ”Insurance Bill 2079” :
-An Insurance Development Fund will be established by the Central Government to provide access to insurance to marginalized community and citizens. The fund will be run by the Insurance Authority.
-The Bill will replace Insurance Act 2049 and Insurance Bylaws 2049.
-The existing manpower including the Chairman and members and structure will be transformed to the Insurance Authority. Those people will remain in the same designation prior to their next promotion.
-The Insurance Authority will be allowed to collect 0.75 percent of the total insurance premiums from the companies against regulatory fees. There is also a provision in the bill that one third (33 percent) of the amount will be transferred in the Insurance Development Fund and the remaining amount can be kept in other funds of the Authority itself.
-The bill stipulates two terms for Chairman of Board of Directors and Chief Executive officers of insurance companies. However, in the case of the members of the BODs, the tenure has not been not specified in the Bill. Contrary to that, the recent amendments made in the Corporate Governance of the Insurers by the Insurance Board, the Chairman, Member of BODs or CEOs can enjoy maximum of two terms. Similarly, there is a provision in the bill that an independent director cannot become a chairman in an insurance company.
-The existing provision that the same company cannot deliver life, non-life and reinsurance has been continued in the new Bill too.