Kathmandu. KATHMANDU: Infomerics Credit Rating Nepal Limited (Infomerics Nepal) has maintained that the insurance company has maintained its ‘Single A Minus’ Issue Rating. In addition, the company has also been removed from the Watch with Negative Implications monitoring.
Institutions that receive this rating have adequate safeguards to meet their financial obligations on time and have low credit risk, the rating agency said.
Last fiscal year 2081. The company’s total income increased to Rs 2.37 billion from Rs 1.59 billion in the previous year. In addition, the company’s net profit increased significantly from Rs 5.90 crore to Rs 19.40 crore.
Nepal Insurance Company was established in 1947 and is the oldest non-life insurance company in Nepal. In the company, Nepal Bank Limited (15.04 percent) and Asian Life Insurance Company (14.97 percent) are the major promoters.
The company owns land in prominent locations like New Road, Kamaladi, Birgunj and Bharatpur. The company’s reserve fund is likely to be stronger in the future as the real market value of these lands, which have been valuated on the basis of historical costs.
The company’s business is primarily focused on motor and property insurance. It accounted for 73 percent of the total insurance revenue in the last fiscal year. Due to the recent youth protests and protests, the company’s claim payment ratio is 2082 in the current fiscal year. By the third quarter of ’83, it had risen to 74 percent. As a result, the company’s net profit declined to Rs 10.60 crore in the review period.
Intense competition in the insurance market and changes in the rules and regulations issued by the Insurance Authority of Nepal may affect the company’s future profit. According to Infomarix Nepal, the main test for the company to expand its business in the future will be to improve the investment return while maintaining the minimum paid-up capital and solvency standards set by the regulatory body.
