Nepal Re in FY7879: Poor Underwriting Results Surge in Claim

Kathmandu: The state-owned reinsurer, Nepal Reinsurance Company(Nepal Re) has witnessed surge in claim payment in the last fiscal year 2078-79.The net claim payment has increased by 55 percent as compared to previous FY 2077-78.

Nepal Re has paid a net claim of Rs. 8.13 billion including Rs. 5.8 billion paid to the general insurer.It has paid Rs.3.10 billion reinsurance claim to life insurers. The claim paid to life insurer is comparatively high as compared to the risk factor associated with the life insurance business. During previous FY, Nepal Re had paid net claim of Rs. 5.27 billion.

The company has Rs.1.87 billion outstanding claim to general insurers in FY 2078-79 while it was Rs.1.79 billion in previous FY.

It has earned net insurance premiums of Rs.10.78 billion in last FY but net claims payout remained Rs. 8.13 billion. In addition, the company has spent Rs. 2.96 billion for reinsurance commission to get the business. In total the outflow was Rs.10.34 billion including reinsurance commission.

The mounting bank interest rate has made a positive impact on it’s profit. The profit has increased by 10.45 percent in last FY. It has earned profit of Rs. 67.87 lakh which includes the surplus from general insurance Rs. 56.50 crore.

Net insurance fee income has increased by Rs. 15.89 percent to Rs.10.75 billion while such income was Rs. 9.29 billion in previous FY. It’s reserve fund has increased by 133 percent to Rs. 6.82 billion.

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