Finance Minister presents Insurance Draft in the parliament; Introduction of Beema Pradhikaran, Cancellation of license of Insurance companies & many more highlights

Fri, Jul 13, 2018 11:10 AM on Economy, Latest, Stock Market,

Finance Minister Dr Yubaraj Khatiwada has presented Insurance Draft Act 2075 in the parliament which was approved by the Cabinet of Ministers only a few days back. The main highlight in the presented draft is the conversion of Insurance Board (Beema Samiti) as Nepal Insurance Authority (Beema Pradhikaran).

Other major highlights of the draft are;

  1. To establish Nepal Beema Pradhikaran in order to make the insurance business managed, regular, competitive and trustworthy.
  2. To transfer all the rights and duties of Beema Samiti to Beema Pradhikaran.
  3. To handover the authority of providing services, facilities, regulations and maintenance of organizational structures to the Ministry of Finance.
  4. To conclude the tenure of the Beema Samiti.
  5. The government will take 50% of the amount collected in the Board’s Fund.
  6. The paid up capital of the insurance company will be revised from time to time. The license of company failing to meet the capital requirement will be cancelled.
  7. The insurance companies should maintain insurance fund as determined by the Beema Pradhikaran.
  8. To maintain separate compulsory insurance fund to cover the losses in insurance business.
  9. Every insurance company should issue 30 percent of its issued capital for the general public.
  10. In case of foreign insurance companies, capital should not be issued to the general public.
  11. The insurance company can separate 5% of the shares to be issued for general public for the employees.
  12. The insurance companies need to maintain capital holding ratio in 51:49 for promoters and ordinary shareholders respectively.

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