{"id":251078,"date":"2025-04-30T06:44:23","date_gmt":"2025-04-30T00:59:23","guid":{"rendered":"https:\/\/insurancekhabar.com\/life-insurers-reluctant-to-implement-new-provisions-on-agent-incentives-2\/"},"modified":"2026-09-05T16:05:06","modified_gmt":"2026-09-05T10:20:06","slug":"life-insurers-reluctant-to-implement-new-provisions-on-agent-incentives-2","status":"publish","type":"post","link":"https:\/\/english.insurancekhabar.com\/life-insurers-reluctant-to-implement-new-provisions-on-agent-incentives-2\/","title":{"rendered":"Life insurers reluctant to implement new provision of agent incentive"},"content":{"rendered":"

Kathmandu. Life insurers are reluctant to apply the incentive provisions implemented by the Insurance Regulations 2081. <\/p>\n

There is a provision in the rules that the incentive should be distributed on the basis of the insurance policy renewal rate. Contrary to such provision, the insurer is providing the entire amount of incentive as before, ignoring the renewal rate of the insurance policy sold by the agent in the past. <\/p>\n

Rule 44 of the Insurance Regulations 2081 contains provisions relating to the commission and incentive of the agent. Sub-regulation 3 of the Act provides that the incentive amount should be paid only by deducting the amount as mentioned in Schedule 10 on the basis of the renewal ratio of the insurance policy issued through each agent. <\/p>\n

Life insurers are reluctant to implement such provisions of the regulations. Life insurers are delaying the implementation of this provision due to pressure from agents. Some insurers have partially implemented it but are still in a ‘wait and see’ mode. <\/p>\n

\"\"
Provision relating to Agent Incentive Rule 44 of Insurance Rules 2081<\/figcaption><\/figure>\n

In order to discourage the agents with weak insurance renewal rate and to encourage business agents, a provision has been made to determine the amount of incentive on the basis of the service after the sale of the policy and the renewal rate. <\/p>\n

In the regular period, there is a provision to deduct 20 percent of the incentive for agents with a renewal rate of less than 30 percent and 15 percent for agents with a renewal rate of less than 45 percent. Similarly, there is a provision to deduct 10 percent of the incentive for agents with a renewal rate of up to 60 percent and 5 percent for agents with a renewal rate of 60 to 75 percent. <\/p>\n

Any incentive should be determined on the basis of the performance of the person or group concerned. In the life insurance sector, the rate of surrender or surrender of the insurance policy was high as the first insurance premium was distributed only on the basis of income and not on the basis of performance excellence in the life insurance incentive. <\/p>\n

According to the sources, the incentive distribution is being done on the basis of an informal agreement to implement the provision related to the deduction only after the end of June as the incentive is being deducted. As the end of the fiscal year is approaching and the provisions of the regulations are also in effect only from February 26, they are expecting a compensation from the Nepal Insurance Authority by not implementing the provisions for the current fiscal year. <\/p>\n

The general insured has suffered due to the tendency to insure life insurance by completely ignoring the income level of the insured, the stability of the income source, the nature of the income source and the ability to sav. The new provision related to incentives is expected to not only provide after-sales services to the senior agents and agency managers by being in regular contact with their old insured but also encourage the new entrants to go to the insured’s doorstep for after-sales services. <\/p>\n

In order to ensure the renewal rate, the insurer is working on developing an automated system in the life insurance software to track (identify) the renewal rate of the policies sold by the concerned agent and its subordinate agents. They say that the development of the software may take some time as this work has to be implemented according to the conditions with conditions rather than the normal situation.<\/p>\n","protected":false},"excerpt":{"rendered":"

Kathmandu. Life insurers are reluctant to apply the incentive provisions implemented by the Insurance Regulations 2081. There is a provision in the rules that the incentive should be distributed on the basis of the insurance policy renewal rate. Contrary to such provision, the insurer is providing the entire amount of incentive as before, ignoring the […]<\/p>\n","protected":false},"author":5,"featured_media":230057,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[45057,45031,45152,45159],"tags":[],"class_list":["post-251078","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-abhikarta-en","category-banner-news-en","category-life-insurance-en","category-news-en"],"acf":[],"_links":{"self":[{"href":"https:\/\/english.insurancekhabar.com\/ikbrapi\/wp\/v2\/posts\/251078","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/english.insurancekhabar.com\/ikbrapi\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/english.insurancekhabar.com\/ikbrapi\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/english.insurancekhabar.com\/ikbrapi\/wp\/v2\/users\/5"}],"replies":[{"embeddable":true,"href":"https:\/\/english.insurancekhabar.com\/ikbrapi\/wp\/v2\/comments?post=251078"}],"version-history":[{"count":1,"href":"https:\/\/english.insurancekhabar.com\/ikbrapi\/wp\/v2\/posts\/251078\/revisions"}],"predecessor-version":[{"id":314441,"href":"https:\/\/english.insurancekhabar.com\/ikbrapi\/wp\/v2\/posts\/251078\/revisions\/314441"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/english.insurancekhabar.com\/ikbrapi\/wp\/v2\/media\/230057"}],"wp:attachment":[{"href":"https:\/\/english.insurancekhabar.com\/ikbrapi\/wp\/v2\/media?parent=251078"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/english.insurancekhabar.com\/ikbrapi\/wp\/v2\/categories?post=251078"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/english.insurancekhabar.com\/ikbrapi\/wp\/v2\/tags?post=251078"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}