August 4, 2021 03:09 PM NPT
KATHMANDU, August 4: The payment of COVID-19 insurance claims has been postponed without fulfilling the obligation. The Nepal Insurers’ Association has issued a notice stating that the payment of COVID-19 insurance has been stopped. The association has stated that the payment of COVID insurance claims had to be postponed as the government has not released the amount. It was agreed that non-life insurance companies, Nepal Reinsurance and Insurance Committee and the government should pay for COVID-19 insurance.
Insurers have said that the payment of COVID insurance had to be postponed as the amount to be disbursed by the government could not be released on time. According to the association, the COVID insurance, which started in April 2020 after the start of the COVID pandemic in Nepal, expired in mid-July 2021.
In a period of one year, non-life insurance companies had sold 1,758,343 COVID policies. A premium of Rs 1.5 billion was collected from the sale of these insurance policies. Out of which, 958,198 insurance policies were sold with government premium grants.
The association has stated that the government has not paid the amount of Rs 419.414 million for the government premium grant policies. During this period, 137,754 COVID insurance claims amounting to Rs 13.14 billion were received. Of the total claims, Rs 4.78 billion has been paid so far.
Of the total claims, Rs 9.62 billion is yet to be paid. According to the committee, 60,587 insured have so far received the sum insured. "We are demanding the payment be made as soon as possible as the overall insurance company will be discredited if the claim is not paid," said an official of the association. "But there has been no response from the finance ministry."
The COVID Insurance Directive stipulates that the insurance company is liable to pay up to Rs 1 billion, the reinsurance company Rs 1 to 2 billion, the company’s catastrophe fund Rs 2 billion to 2.5 billion and the committee Rs 2.5 billion to Rs 3.5 billion. The guideline states that the government will have a liability to pay for more than Rs 3.5 billion. The payment has already been made after the insurance company, reinsurance and the committee sent the amount to the pool as per their obligation.