Beema Samiti to take final call on operational license of firms that applied before 2008
April 4, 2017 09:50 AM NPT
KATHMANDU, April 4: Beema Samiti says is going to clear from its pending tray applications for licenses to operate as insurance companies submitted before 2008.
As action is needed on applications for operational licenses from nearly 13 companies that had completed due process, newly-appointed Beema Samiti Chairman Chiranjibi Chapagain indicated that the insurance regulatory authority will take the final call on these applications soon.
“These companies’ applications have remained pending for a long time now. We have to give them our final decision and settle those pending files,” Chapagain told Republica.
“We should either grant them operating licenses or tell them why they are ineligible,” Chapagain added.
The statement from Chapagain follows the insurance market regulator’s introducing of new guidelines on insurer registration and insurance business operation which, among others, lays down the procedure and conditions for registration and operation of insurance companies.
Unlike the existing provision that requires an insurance firm to get the regulator’s letter of intent before being registered at the Office of Company Registrar (OCR), insurance companies used to come to Beema Samiti to seek operational licenses after getting incorporated at OCR.
However, since March 2008, Beema Samiti has put on hold applications from nearly 13 insurance companies without giving them operational licenses while it made it mandatory for new applicants to get its letter of intent before registering at OCR.
Chapagain, however, did not say when Beema Samiti would decide on the fate of these pending applications.
Pending applicants include Reliable, Reliance, IME, Sanima, General, Manakamana and Sanima, among other 13 life and non-life insurance companies.
Meanwhile, Beema Samiti will separately decide whether to open license for new insurance companies, Chapagain said. “We have come up with guidelines that lay down the process and conditions for registration and operation of insurance companies.
Whether licensing will be opened now or later will be decided by the board,” he added.
A board meeting of Beema Samiti held on Friday had approved guidelines that raised the minimum paid-up capital requirement for both life insurance and non-life insurance companies by four times.
Each life insurance company will have to increase its paid-up capital to Rs 2 billion while a non-life insurance company will have to raise its paid-up capital to Rs 1 billion by mid-July 2018. Currently, a life insurance company has a minimum paid-up capital requirement of Rs 500 million and while for a non-life insurance company, the minimum requirement is Rs 250 million.