Kathmandu: Nepal Insurance Authority has finalized the draft of the Insurance Bylaw 2080 and submitted it to the Ministry of Finance for approval. The new bylaw has been prepared to harmonize the insurance regulations in accordance with the Insurance Act 2079.
The new Bylaws will replace the existing Insurance Bylaws 2049. Further provisions regarding the agency commission, use of expert services, chief executive officer tenure, and many other issues have been made in the proposed Bylaw.
The Authority has introduced a new provision on agency incentives to discourage a high volume of policy lapse. The new condition states that an agency with a higher rate of policy renewal will be eligible to receive a higher percentage of incentives and vice versa. According to the existing provision, a life insurance company can distribute up to 18 percent of first insurance premiums as an incentive to the agency. Such incentives are distributed beyond the regular commission.
Similarly, now an aspirant needs to have at least plus two level’s academic qualifications to apply for the agency license. The agency license fee has been hiked to NPR 3,000 from the existing NPR 500.
SN |
Types of Policy |
Policy Term |
First Year(%) |
Second Year(%) |
Third Year Onwards Till 10th Year |
| 1 | Endowment and Whole Life Policy | 5 to 7 year | 10 | 5 | 5 |
| 8 to 9 years | 10 | 10 | 5 | ||
| 10 to 14 years | 15 | 15 | 5 | ||
| 15 to 19 years | 25 | 15 | 5 | ||
| 20 years or above | 25 | 25 | 5 | ||
| 2 | Single Premium Payment | Up to 6 percent of the insurance premium is to be paid proportionately in the first five years of the life insurance policy issue | |||
| 3 | Term Life Insurance | Irrespective of Policy Term, up to 10 percent of the insurance premiums | |||
| 4 | Other Insurance Plans | As specified by the Authority | |||
