Appellate Court issues interim order against PrimeLife CEO

ShareSansar, November 29:

The Appellate Court Patan has issued an interim order asking PrimeLife Insurance Limited not to let its just reappointed Chief Executive Officer Reshta Jha to assume office.

A single bench of justice Shiva Raj Adhikari issued the interim order as per Article 22 ‘A” of the Appellate Court Regulations-2048.

Jha has also been asked to present himself before the court on December 4.

A complaint was lodged at the Appellate Court after the insurance company defied the last month’s order of the Insurance Board not to reappoint Jha to the post of the CEO, stating that he has enough experience and qualification to handle the post.

As per the new Insurance Corporate Governance Regulation 2069, the regulator in October had rejected Jha’s reappointment as the chief executive of the insurance company, citing eligibility criterion.

Meanwhile, Primelife insurance company has been urging the Insurance Board to review its decision, stating that Jha meets both the educational as well as professional qualification for the post.

IB Chairperson Fattah Bahadur KC has said that they are “considering the request”.
Restha Jha was reappointed as the CEO of the company in September, notwithstanding the fact that he had got into troubles with the regulator in the past.

As per the new regulation, a CEO must to have a minimum of ten years of experience in managerial level, but Jha does not meet that criterion, according to the Insurance Board officials.

However, Primelife insists that Jha meets the criteria since he has around 12 years of experience of working in various BFIs and insurance companies.

Meanwhile, Jha has been coming to the office as the IB has not formally responded to the company’s request to reconsider its decision not to approve of his reappointment.

Shortly before his reappointment as the CEO, the Insurance Board had penalised Jha Rs 10,000 (which is the highest amount of fine the board could impose) for indulging in expenditures beyond the limit set by the regulator on agent incentive and promotional activities.

And the regular had gone on to direct the company to hold a Due Diligence Audit.
Last year the IB had sought clarification from Jha for procuring interior décor items without calling for proposals.