{"id":311626,"date":"2026-08-18T07:50:50","date_gmt":"2026-08-18T02:05:50","guid":{"rendered":"https:\/\/insurancekhabar.com\/?p=311626"},"modified":"2026-08-18T07:55:05","modified_gmt":"2026-08-18T02:10:05","slug":"misuse-of-discounted-facility-given-to-the-insured-for-direct-insurance-2","status":"publish","type":"post","link":"https:\/\/english.insurancekhabar.com\/misuse-of-discounted-facility-given-to-the-insured-for-direct-insurance-2\/","title":{"rendered":"Misuse of discounted facility given to the insured for direct insurance"},"content":{"rendered":"

Kathmandu. It has been found that the provision of giving discount on insurance premium to the insured who comes directly to the counter of the life insurer has been misused. Although there is a provision that the insurer should waive 50 percent of the insurance premium, such discount facility has been provided differently from insurer to insurer. <\/p>\n

The Government of Nepal through the Insurance Rules, 2081 BS has made a provision to provide 50% discount on the amount of the agent commission to the person who comes directly to the office of the insurer for life insurance. The reason behind the government’s regulation is to reduce its dependence on traditional distribution systems. <\/p>\n

This facility has been made available to the insured who comes to contact the insurer for direct insurance without the involvement of the intermediary. Officials of the Agents Association have complained that the insurer has misused this provision in the regulation and provided more discounts than the stipulated discount. <\/p>\n

Om Bahadur KC, president of Professional Insurance Agents Association of Nepal, said that the insurer’s decision to provide discount of up to 14% on insurance premium to the insured is against the provision of insurance regulation. He said, “There is also a regulatory weakness in this. There is a tendency for the regulator to take action on the issue of dealing with the agent, but in other cases, the old system will continue. \u2019<\/p>\n

Rule 44 of the Insurance Regulations has provisions regarding the commission and incentives of insurance agents. This rule provides for the following commission on the amount of insurance premium to the insurance agent: <\/p>\n

(a) Life insurance as per Schedule-9, <\/p>\n

(b) 5% of the premium on non-life insurance. <\/p>\n

(c) In the case of micro insurance and health insurance as determined by the Authority. <\/p>\n

(2) In addition to the commission amount referred to in Sub-rule (1), an incentive amount may be provided in such a way that it does not exceed the limit determined by the per agent authority on the first premium of life insurance. However, there is no incentive to be given to the insurance agent in the insurance through institutional insurance agent and in the insurance made by the Government of Nepal. <\/p>\n

Rajendra Amatya, president of Nepal National Insurance Agents Association, said that there has been a lot of disagreement over many provisions against the interest of the agent from the very beginning, including the discount on direct insurance. “Efforts have been made to ignore the significant contribution of individual agents in the life insurance market by introducing provisions such as discount on direct insurance and reduction in incentives,” he said. \u2019<\/p>\n

Sub-rule (4) of Rule 44 states that if the insured comes to insure himself or herself, the insurer shall waive 50 percent of the commission as referred to in Sub-rule (1) on the insurance premium. According to this provision, the insured will get 50% discount on the amount of the premium during the term of the policy. For example, if an agent gets 25 percent in the first year, 15 percent in the second year and 5 percent in the third year to 10 years, then the insured should provide 12.5 percent discount, 7.5 percent in the second year and 2.5 percent for the third to 10th year. <\/p>\n

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Insurance Regulations 2081 Schedule 9<\/figcaption><\/figure>\n

}<\/p>\n

Prabin Raman Parajuli, president of Life Insurance Association of Nepal, said that the association has written to the Insurance Authority to clarify the provision of the regulation related to direct exemption. He said, “The discount is said to be available on the basis of commission, but it is not clear whether it will be given only on the first insurance premium or on the renewal insurance premium like the agent commission.” \u2019<\/p>\n

Managing Director of Nepal Insurance Authority Sushil Dev Subedi said that the provisions of the Insurance Regulations are related to discount to the insured who comes for direct insurance. He said, “The regulation is clear that anyone who goes directly to the insurer’s counter will be given 50 percent discount on the commission received by the agent for that insurance.” AI-generated imaginary image<\/em><\/p>\n","protected":false},"excerpt":{"rendered":"

Kathmandu. It has been found that the provision of giving discount on insurance premium to the insured who comes directly to the counter of the life insurer has been misused. Although there is a provision that the insurer should waive 50 percent of the insurance premium, such discount facility has been provided differently from insurer […]<\/p>\n","protected":false},"author":5,"featured_media":311614,"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-311626","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\/311626","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=311626"}],"version-history":[{"count":1,"href":"https:\/\/english.insurancekhabar.com\/ikbrapi\/wp\/v2\/posts\/311626\/revisions"}],"predecessor-version":[{"id":311627,"href":"https:\/\/english.insurancekhabar.com\/ikbrapi\/wp\/v2\/posts\/311626\/revisions\/311627"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/english.insurancekhabar.com\/ikbrapi\/wp\/v2\/media\/311614"}],"wp:attachment":[{"href":"https:\/\/english.insurancekhabar.com\/ikbrapi\/wp\/v2\/media?parent=311626"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/english.insurancekhabar.com\/ikbrapi\/wp\/v2\/categories?post=311626"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/english.insurancekhabar.com\/ikbrapi\/wp\/v2\/tags?post=311626"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}