Nepal | May 27, 2020

IB grants operating licence to three new life insurance firms

Himalayan News Service
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Kathmandu, July 6

Three new players are ready to enter the life insurance market after receiving the operating licence from the Insurance Board (IB) on July 2.

The Insurance Board, which is the regulatory authority of the insurance market of the country, has issued operating licence to newly established IME Life Insurance Company, Jyoti Life Insurance Company and UniLife Insurance Company.

According to the board, the newly established companies must begin their formal operation within six months of getting the operation licence.

Along with these three, seven other companies have already obtained the letter of intent from the Insurance Board. “Three companies that met the minimum paid-up capital requirement have been granted the operating licence,” said Raju Raman Paudel, director of IB.

In the meantime, the board has issued letter of intent to Citizen Life Insurance, Star Life Insurance, Sun Nepal Life Insurance, Sanima Life Insurance, Reliance Life Insurance, Reliable Life Insurance and Mahalaxmi Insurance. These companies need to fulfil the paid-up capital requirement and submit their documents to IB within two months to get the operating licence.

Insurance companies must have a paid-up capital of Rs two billion to get the operating licence, according to letter of intent issued by the Insurance Board. Of the total paid-up capital, 30 per cent should be separated for the general public in the form of primary shares of each company.

The IB issued letter of intent to those companies that had submitted applications to the board in fiscal year 2007-08.

Currently, there are eight life insurance companies operating in the market. If all the new applicants get the operating licences, the Nepali insurance market will have a total of 18 life insurance firms in the near future.

According to IB, the premium collection in the life insurance sector was about Rs 3.19 billion in fiscal year 2015-16.

A version of this article appears in print on July 07, 2017 of The Himalayan Times.

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