Authority’s manipulation of third party motor insurance policy, allowing micro insurance to bear risk of billions without any supervision
Kathmandu: It has been found that the regulator Nepal Insurance Authority has allowed micro insurance that cannot bear the risk by manipulating the third party motor insurance policy. On 3rd of January, 2024 A.D (18th of Paush, 2080 B.S) the authority revised the micro insurance guidelines and decided to allow four micro insurance companies to issue motor insurance and third party motor insurance policies up to 5 million Rupees.
According to the decision of the board of directors of the authority, it has been clearly seen that there has been manipulation in the guidelines related to micro insurance. According to which, four micro insurance companies with a total paid-up capital of 520 million Rupees have been given permission for third party motor insurance with a risk of billions of rupees. With this permission, micro insurance companies operating in Nepal have started to issue third party micro insurance policies.
Currently, Nepal Micro Insurance Company, Protective Insurance Company, Star Micro Insurance Company and Trust Micro Insurance Company have received permission for micro insurance. In the setting with the four companies mentioned by the authority, it has been seen that the micro insurance company has been allowed to issue motor insurance policies of complex nature and liability of billions of rupees insured amount. However, the authority did not want to say anything in this regard.
A former CEO of one of the Insurance company told Beemapost that the authority allowed third party motor insurance to small insurance companies without any study. “It turned out to be a lottery business instead of insurance, the third party motor insurance was made like corona insurance,” said a senior official of an insurance company. According to the source, there is a lot of discussion in the insurance sector that there is a big setting in this work. Due to the lack of insurance-related skills and professionalism among the employees and high-level people working in the authority, many of the works done by the regulator of the insurance sector have been getting into controversy.