Kathmandu: The state-owned reinsurer, Nepal Re-insurance Company Limited (Nepal Re) will loss annual revenue of Rs. 4 billion to it’s competitor Himalayan Re-insurance Co. Ltd.(Himalayan Re) amid state’s favour to the private player.
Himalayan Re promoted by the private sector is consistently securing business from domestic insurers under the special privilege given by the Government and Nepal Insurance Authority(NIA). Nepal Re had been enjoying 20 percent direct cession from the domestic insurance companies until the NIA(Former Insurance Board) has introduced the provision that such direct cession must be equally distributed to both indigenous re-insurers.
In an interview with insurancekhbar.com, Shanker Kumar Rayamajhi, the CEO of Nepal Re, has admitted that with the new provisions for re-insurance business sharing, Nepal Re will loss at least Rs. 4 billion revenue annually.
He further emphasized on the increment of paid-up capital of Nepal Re to strengthen it’s financial strength amid growing risk of global warming and climate change. He said,’ Personally, I believe that at least twenty five billion rupees paid-up capital is required for us.’ The current paid-up capital of Nepal Re is Rs. 12.23 billion.