Kathmandu. Kathmandu: Nepal Insurance Authority (NEA) has organized an interaction programme on one year of risk-based capital (RBC) implementation in the Nepali insurance industry: progress, challenges and the way forward.
The program was organized with the objective of taking suggestions of insurers after detailed discussion on the progress achieved during the one year of implementation of RBC in the insurance industry, the challenges faced and the way forward.
Addressing the program, Chairman of Nepal Insurance Authority Sharad Ojha said that the authority will start the process of analyzing the reports related to RBCs of insurance companies on a quarterly basis.
Chairman Ojha said, “It is a mandatory provision of the Insurance Act that the financial statements of insurance companies should be approved by mid-January, according to the Act, it is the effort of the AUTHORITY to approve the financial statements by mid-January, the NEA team is ready to facilitate this effort, insurance companies should also proceed with the work in such a way that the financial statements are approved on time. ’’
Pointing out the need for insurance companies to propose investment in a proper manner to ensure proper returns, Chairman Ojha said, “Insurance companies should diversify their investment, but in the right place, investment proposals should come in the real sector properly to ensure returns from the companies. ’’
Stating that capital charge has been arranged keeping in view the practice of countries like our country and the AUTHORITY is ready to make timely reforms if it is high, Chairman Ojha said that the insurance industry should start efforts to invest in the bonds issued by the government and a separate mechanism would be required for this.
Chairman Ojha said that the AUTHORITY was working to revise all the guidelines by integrating them and sought suggestions from the insurers in this regard.
In his welcome address on the occasion, Executive Director of Nepal Insurance Authority Sushil Dev Subedi said that the implementation of RBC is currently in the transition period and urged the insurance companies to move ahead with determination to achieve the common objective of reducing risk.
Pujan Dhungel Adhikari, director of Nepal Insurance Authority, said that most of the insurers have met the target of RBC.
President of Nepal Life Insurance Association, Mr. Nuposh Raj Poudel and President of Nepal Insurance Association Mr. Birendra Baidwar said that the implementation of RBC in the insurance industry is a great achievement.
On the occasion, Deputy Director of Nepal Insurance Authority Nirmala Malla made a presentation on the progress of implementation of RBC, existing challenges and the way forward. Directors of Nepal Insurance Authority, CHIEF Executive Officers of Life Insurance Company, Non-Life Insurance Company and Reinsurance Company and RBC Focal Persons participated in the program.
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