Rastriya Beema Company hits major setback

KATHMANDU:

Problems have started mounting at Rastriya Beema Company Limited (RBCL), a state-owned non-life insurance company, as it has been prevented from operating as an independent firm due to delay made by employees of Rastriya Beema Sansthan in handing over of assets and liabilities to the insurer.

This has raised question on the fate of the company, which had split from state-owned life insurer, Rastriya Beema Sansthan, under pressure from the Insurance Board, the insurance sector regulator, which bars a single company from conducting life as well non-life insurance businesses.

The Cabinet had formally decided to split life and non-life businesses of Rastriya Beema Sansthan on May 6 upon criticism from various sectors for allowing a single company to illegally operate life and non-life businesses.

Following this, Rastriya Beema Company Limited was registered as non-life insurer at the Office of the Company Registrar, and was extended non-life insurance business licence by the Insurance Board on July 11.

Based on this, the company, on July 14, issued a public notice calling on interested employees of Rastriya Beema Sansthan, who want to work for Rastriya Beema Company Limited, to report to the office by Wednesday.

At that time, the company had said employees who want to relocate to non-life insurance company would be entitled to same financial benefits, including salary, perks, pension and gratuity, as at the life insurance company.

“Now, only two days are left for the staff of Rastriya Beema Sansthan to join the new non-life insurance company,” a source with knowledge of the matter told The Himalayan Times. “But none of the assets and liabilities has been transferred by the Beema Sansthan.”

The delay, according to the source, is taking place despite maintenance of separate book of account by non-life insurance business.

“This shows that the staff are deliberately trying to prolong the process of transfer of assets and liabilities,” the source said. “Since nothing has been transferred, Rastriya Beema Sansthan is still conducting non-life business, including settlement of claims, on behalf of the non-life insurer,” the source added.

All this has created confusion at the non-life insurer and staff members of the life insurance company are hesitating to join the new non-life insurance company, the source informed.

Besides transfer of books of account, Rastriya Beema Sansthan is yet to transfer around half of around 15 ropanis of land located at Ram Shah Path to the non-life insurance company. Surprisingly, this plot of land, according to the source, is registered in the name of Nepal Food Corporation.

“Actually, the land was previously bought in the name of food corporation and was extended to the insurer. But the ownership has not been transferred till date,” the source informed. “This indicates the process of transferring ownership of land would take some time.”

One of the board members of Rastriya Beema Sansthan, meanwhile, said the company was still working on the process of handing over assets and liabilities.

“We are working on it and will make the transfer soon,” he said, without mentioning the timeframe for the transfer of assets and liabilities or clarifying the reason for the delay.

Source: THT