Kathmandu: Nepal Insurance Authority is mulling to establish Insurance Information Center to handle insurance claim related issues and combat fraud. The Second Strategic Plan 2023-2027 has identified that the claim settlement process adopted by the industry is not so effective.
The strategic pillar of the Strategic Plan emphasized on the improvement of claim settlement process to increase the trust and maintain the credibility of the insurance industry. The Plan admits that ”the emerging issue of insurance sector is interconnected with the effectiveness of insurance claims; it is intensively required to make the payment of insurance claims easier and faster in order to increase the trust in insurance and maintain the credibility in insurance sector.”
The issues identified in the Plan are:
- The claim settlement process is not so effective
- The prompt claim settlement mechanism is very necessary to gain the credibility of the general public towards the insurance sector
- It is need to establish Insurance Information Bureau, to aid in the efficient operation of the insurance sector by providing complete, consistent, and concise information support to members of the Society and all other stakeholders associated directly or indirectly with the insurance sector
The Plan aims to improve claim settlement process through the development of claim related web portal of NIA and the Insurance Industry in between year 2026-2027. The regulatory initiation has not been taken yet for the same. Further, Insurance Information Center(IIC) has been proposed to address the lack of grievances handling mechanism in the insurance industry. The time frame for the establishment of IIC has been set between 2023-2025.
According to the Plan, systems for countering insurance fraud and crimes will be developed by the end of year 2024. The regulatory authority is hopeful to counter insurance related fraud with the existence of such mechanism. Insurance industry experts share that such mechanism can be established only with the integration of data and information among insurers with the facilitation of the NIA. The banking industry uses Credit Information Center(CIC) to share credit related information and avoid fraud in credit disbursement.
