Rastriya Beema Company Faces Financial Crisis After Rs 1 Billion Loss, Investigations Underway

Kathmandu – Rastriya Beema Company, is currently facing a serious financial crisis after suffering losses exceeding Rs 1 billion. With a paid-up capital of just Rs 266.6 million, the company’s financial stability is now in question.

The crisis stemmed from a major claim related to the Upper Tamakoshi Hydropower Project, which was insured by Rastriya Beema Company. Following severe flooding on September 28, the project submitted a claim of Rs 1.78 billion. However, the company failed to secure re-insurance after the flood, which has led to severe financial strain. Serious allegations have been made against Subash Koirala, the then-acting CEO, and Dr. Sirjana Pant, head of the reinsurance department, for their roles in the company’s mismanagement.

The company’s board of directors has initiated an investigation into the matter. While the insurance claim payment was lower than initially anticipated, the full extent of the company’s financial losses remains unclear. At present, the company’s reserve fund of Rs 2.33 billion is being utilized to cover the claim, leading to an estimated 40 percent depletion of the fund.

This situation has had a significant negative impact on the company’s share price, which has experienced a sharp decline. With the Nepal Insurance Authority expected to declare the company in trouble under the Insurance Act 101, Rastriya Beema Company’s future remains uncertain, and investors are likely to face substantial losses.