Kathmandu: The Insurance Board formed under the Insurance Act 2049 has been transformed to Nepal Insurance Authority(NIA) under the newly implemented Insurance Act 2079.
The board of directors(BODs) of former Insurance Board will continue to serve their remaining term in the NIA.
After the completion of term of existing members of BODs, a selection committee in the coordination of the representative of National Planning Commission will be formed to recommend name(s) to the Government for the appointment of the chairman of the BODs of NIA. Following the recommendation, the Govt will appoint the chairman of the NIA.
It is mentioned in the Act that NIA has been established as the regulatory body of Insurance Industry. The Authority shall be a self-governing body corporated with uninterrupted succession and shall acquire legal personality. As a legal person, the Authority shall exercise its rights, comply with its duties and perform its obligations in accordance with the prevailing laws.
The preamble of the new Act mentions that, to develop the insurance system and insurance services by making it orderly, regular, competitive and reliable, to provide quality and reliable insurance services to the general public through healthy competition in the insurance business, and to protect the rights and interests of the insured by effective regulation, by revising and unifying the existing laws related to insurance, an Act has been written to make it relevant.
In relation to insurance, the Authority will act as an advisor to the Government of Nepal and formulate a national insurance policy and recommend it to the Government of Nepal.
Granting granting and revoking licenses to insurance companies, issuing necessary regulations, guidelines and orders for insurance business, granting, renewing and revoking licenses to insurance intermediaries, determining the capital and capital fund related to insurance business are some of the duty and responsibilities of the NIA. It is the duty of the regulatory authority to create and implement necessary programs to make them organized, regular, competitive and reliable, to study, research, train, orient and raise awareness for the development and expansion of the insurance business.
Similarly, for the development of insurance business, to produce skilled manpower and to formulate and implement a program related to the promotion of insurance education, to formulate and implement a program related to the promotion of insurance business to make insurance accessible to all people. It will coordinate, collaborate and share information with other government and non-government agencies for regulation, inspection, supervision and development of insurance industry.
Coordinate with insurance regulatory bodies of foreign countries as well as international organizations, insurance-related studies, research and training programs, to cooperate with other organizations, to represent the Nepalese government or authorities in international organizations related to insurance regulation, and to obtain membership of such organizations are some of the duties and responsibilities of the NIA.
NIA has been made responsible for the establishment and management of the Policyholder Protection Fund.
Currently there are 18 general insurance, 19 life insurance and 2 reinsurance companies. The Govt also mulls to add another 7 micro insurance companies.