Kathmandu: The insurance industry witnessed a poor surplus in the total premium collection during the last financial year 2079-80. The life and nonlife insurers could collect only a total of NPR 182.88 billion in total premium income(TPI) in the last FY.
According to the preliminary data unveiled by the Nepal Insurance Authority, the insurance industry could hardly achieve a minor growth rate of 2.85 percent. The TPI of the insurance industry exceeded NPR 5.7 billion only as compared to the TPI of the previous FY 2078-79.
According to the Authority, in the last year 2079-80, insurance companies collected a total of NPR 1 trillion 82 billion 880 million. In the previous year 2078-79, the TPI was NPR 1 trillion 77 billion 810 million. In the previous FY, the insurance industry had achieved a growth of 16.48 percent.
Earlier, the regulatory authority had predicted that the industry will achieve a growth of 5.54 percent in TPI. It had been expected that the TPI would be NPR 1 trillion 87 billion 590 million. The TPI of last FY fell below the forecasted amount by about NPR 6 billion. It was estimated that the TPI for life insurance would be NPR 1 trillion 45 billion and NPR 42 billion for non-life insurance companies.
The insurance sector was under a lot of pressure last year due to the economic slowdown, contraction in the credit flow of banks and financial institutions, and high inflation. With the sharp decrease in the savings capacity of the public, the environment that encourages long-term investment in life insurance could not last for the entire year. On the contrary, after the import of luxury goods including vehicles was opened in the latter half of the last financial year, it became easier for nonlife insurance companies to expand their business.