Kathmandu: The insurance density in Nepal is around Rs. 5,865.91 paise. To compare this amount in US dollars, it comes to US$45.92. Insurance density in India, which has a strong economy among South Asian countries, was USD 78 in 2020. Similarly, in another neighboring country, Bangladesh had the insurance density USD 10 in 2019.
According to the data published by the insurance regulatory, Insurance Board, the density of life insurance in the financial year 2078-79 remained Rs. 4,573.71 paise. In order to compare it with the international insurance density, when converted in USD, it equals to US$35.80. According to the results of the economic survey conducted in the neighboring country India in 2021-22, the life insurance density in India in 2020 was US$59.
The number obtained by dividing the total insurance premium by the total population is the insurance density. For example, a country with a population of 30 million has a total annual income of 30 billion rupees. In this case, the insurance density comes to Rs.1,000. Insurance density shows how much insurance premium is earned per person in a country on average.
According to the Board, In FY 2078-79, the density of non-life insurance was Rs. 1,292.21 paise. In USD, this amount comes to USD 10.11. In 2020, the density for non-life insurance in India was US$19. Globally, insurance density in 2020 was US$360 for life insurance and US$449 for non-life insurance. Insurance density statistics are very high in Asian countries. For example, China has an insurance density of US$430, Japan $3621, Singapore $4872 and South Korea $3366.
The calculation of insurance density doesn’t include the premium collected by the state-owned Health Insurance Board which runs health insurance program under social security scheme.
According to the Board, the ratio of total insurance fee to gross domestic product is 4.33 in Nepal. The same ratio was 1 percent in India(2020) and 0.4 percent in Bangladesh(2020).
