Nepal Life Insurance Earns ‘Double A Minus’ Rating for Strong Financial Stability and Reliability

Kathmandu — Nepal Life Insurance Limited has achieved a significant milestone by securing a ‘Double A Minus (AA–)’ credit rating from ICRA Nepal, recognizing the company’s exceptional reliability and robust financial performance. This rating places Nepal Life among the institutions with a very high degree of safety and an excellent capacity to meet financial obligations on time.

Operating since 2001, Nepal Life has established itself as a market leader in the life insurance sector, boasting a nationwide network of approximately 190 branches. The company’s strong board of directors, composed of seasoned professionals, coupled with an efficient management team, has reinforced its reputation and operational strength.

With a market share exceeding 25 percent of total life insurance income in Nepal, Nepal Life continues to dominate the sector. Its strong foothold in the market has translated into consistent operational efficiency and steady profitability.

The company’s investment quality has also received high commendation. A majority of its portfolio is placed in secure deposits and income-generating instruments, ensuring stable and safe returns. Despite declining interest rates, Nepal Life maintained an average return of 9.3 percent. Notably, about 99 percent of its insurance business is savings-oriented, contributing to its long-term financial resilience.

As of the end of last FY, Nepal Life’s solvency ratio stands at approximately 145 percent, well above the Insurance Authority of Nepal’s minimum requirement. The company has also implemented sound reinsurance and catastrophe coverage measures to mitigate potential risks. Around 68 percent of total investments are placed in commercial banks, while only 6 percent are allocated to equities, industries, and other sectors.

To ensure comprehensive risk management, Nepal Life has entered into reinsurance agreements with Nepal Reinsurance Company Limited (a government-owned entity rated AA–) and Himalayan Reinsurance Limited for its regular life, micro, and catastrophe insurance portfolios. For general life insurance, the company assumes a maximum risk of Rs 2 million per insured person, maintaining a prudent balance relative to its strong equity base. Furthermore, its catastrophe fund of Rs 2.32 billion (as of mid-July 2025) reflects its preparedness against large-scale claims or unexpected events.

These risk management practices, combined with strategic reinsurance partnerships, have strengthened Nepal Life’s financial foundation and enhanced policyholder and investor confidence.