Kathmandu: Above one dozen of directors of insurance companies will not be able to enjoy their full term. According to Section 50 of the Insurance Act 2079, more than 14 members of the board of directors (BODs) including two directors from Nepal Re-insurance Company(NRIC) cannot continue their term in the BODs.
Nepal Insurance Authority has instructed all the insurers to comply the Section 50 of the Insurance Act and inform the same to it within 15 days.
Clause “E” of Section 50 of the Act states that “incumbent directors or employees who are directors of insurance or bank and financial institutions or any type of deposit collecting organization or who hold the basic shares of the promoter group of any other insurer” are disqualified to become a director in any insurance company.
According to this provision, the employees of any BFIs cannot be directors of any insurance company. Likewise, employees and directors of one insurance company cannot be directors in another insurance company even of a different nature.
Similarly, Clause ‘I’ in this Section states that incumbent employees of the Nepal Government or State-owned institutions, authorities, boards, insurers or banks, or financial institutions cannot be appointed as a member of BODs of any insurance company. According to the clause, the employees of the Government of Nepal are also not allowed to become the directors of the insurance company. However, this provision shall not be considered a hindrance to nominating directors in different types of insurers in which shares are purchased by the Nepal Government, State Government, or Nepal Government-owned organizations or insurers.
Nepal Reinsurance Company
The representative of Shikhar Insurance, CEO Deep Prakash Pandey, and NLG Insurance CEO Sunil Ballav Pant have to quit from the BODs of NRIC.
Prime Life
Prime Life’s Chairman Pius Raj Aryal and Director Dipesh Amatya have to step down. They are employees of Laxmi Bank.
IME Life
Deep Chandra Regmi and Yugesh Bhakt Wade Shrestha, the directors of IME Life, have to step down. Regmi is an employee of Global IME Bank, while Shrestha is the CEO of IME General Insurance.
Prabhu Life
Director of Prabhu Life, Maniram Pokhrel who is the CEO of Prabhu Bank too must quit from BODs of Prabhu Life
National Life
Devendra Raman Khanal, an employee of Rastriya Banijya Bank, is the director of National Life Insurance.
NLG Insurance
National Life CEO Suresh Prasad Khatri and expert Bharat Bahadur Basnet are directors of NLG Insurance.
Prabhu Insurance
Mahesh Prasad Khanal is the Director of the BODs of Prabhu Insurance on behalf of the Employees’ Provident Fund. Similarly, Renu Prasad Pandey is the representative of Prabhu Bank.
Nepal Insurance Company
Nepal Insurance Company Chairman Lakshman Paudel is an employee of Nepal Bank Limited.
Rastriya Beema Company
Krishna Prasad Sharma from the Ministry of Finance, Damodar Prasad Subedi from the Employees’ Provident Fund, and Vishwa Raj Baral from the Rastriya Banijya Bank are the directors of the Rastirya Beema Company.
Rastriya Beema Sansthan
Rastriya Beema Sansthan has Arun Pokharel from the Ministry of Finance, Prakash Kumar Adhikari from Nepal Bank, Ram Prasad Gautam from Rastra Bank, and Rajan Krishna Aryal from the Government of Nepal. In the case of the Rastirya Beema Company and Rastriya Beema Sansthan, there are different opinions from officials of the Authority
