Balen Government Amends Two Provisions of Insurance Act; What Does the Ordinance Say?

Kathmandu — The government has amended two provisions of the Insurance Act, 2022 through an ordinance issued yesterday to revise several Nepal Acts. The amendment removes the previously fixed four-year tenure for members under Section 9 of the Act.

In another change, the government has repealed Subsections (1), (2), and (3) of Section 12, which had set out the procedures and due process for dismissing members of the board of directors. In their place, the ordinance grants the government discretionary authority over such decisions.

Although the draft prepared by the Prime Minister Balen’s secretariat included these amendments, it does not clearly explain the purpose behind revising these specific provisions. The changes effectively allow the government to appoint and remove directors of the Insurance Authority at its discretion, raising concerns about potential political interference.

The rationale for removing the four-year tenure remains unclear. Likewise, questions have been raised as to why board members can now be dismissed without even being asked for clarification. The amendments appear to introduce provisions that run counter to the principles of natural justice.