Insurance Authority Warns of Action Against Delay in Claim Payments

Kathmandu – Nepal Insurance Authority Chairman Sharad Ojha has said that action will be taken against insurance companies and surveyors responsible for delaying claim payments. Speaking at an insurance interaction program organized by the Chamber of Industries, Morang in Biratnagar, Ojha emphasized the authority’s commitment to timely settlement of insurance claims.

He revealed that out of Rs 42 billion in claims, non-life insurers have paid Rs 30 billion so far. “Delayed claims are mostly due to improper risk assessment,” Ojha said, urging both insurers and insured individuals to ensure accurate risk evaluations.

Addressing complaints about high premiums and inconsistent institutional discounts, Ojha clarified that Nepal follows a controlled insurance premium rate system aligned with global practices. “This is not a syndicate but a necessary system in an immature market,” he added, while noting that a shift to detariffing could be considered once the market matures.

Ojha acknowledged the potential of adopting risk-based pricing in the future but cautioned that it might lead to premium hikes. He also stressed the need to study insurance discounts and gradually adopt international best practices. Furthermore, insurance companies have been directed to strengthen their provincial offices with authority to act.

Industrialists raised several concerns, including the inflexible claim settlement process, rise in tariffs, syndicate-like behavior between banks and insurers, and the impractical demands during machinery insurance. They suggested empowering provincial offices to handle claims up to Rs 10 million and tailoring policies to customer needs.

Responding to the concerns, Insurance Authority Director Nirmal Adhikari said that rates were revised based on stakeholder input but could not be changed unilaterally due to international reinsurance linkages. Deputy Director Rajendra Maharjan also presented on key insurance issues, while the Koshi Province Office Chief Binod Pokharel moderated the event.