The management head of the insurance sector regulator has been charged of wielding influence to issue a directive for personal gains and demanding compensation for loss of jet ski by purchasing insurance policy after occurrence of the accident. These allegations were confirmed by multiple sources. [break]
Aryal, who entered the Insurance Board in the capacity of board director prior to landing on the seat of the executive director, is said to have used his board member´s influence to introduce a directive that allowed owners of insured but totally damaged construction and earth moving vehicles to demand hundred percent compensation.
Prior to issuance of the directive, insurance companies used to deduct depreciation amount before settling claims related to fully damaged construction and earth moving vehicles.
But after one of the excavators belonging to Aryal Construction -- a company promoted by Aryal -- was allegedly "burnt" and thus "completely damaged", Aryal took the matter to the regulator´s board and made necessary amendments to the law.
"As a result, Aryal´s firm was able to collect approximately Rs 6.6 million from Shikhar Insurance, as against around Rs 5.1 million he would have collected if the changes to the legal provision were not made," a reliable source of the Insurance Board told Republica on condition of anonymity citing he is not authorized to talk to the media.
As this case of policy corruption was unearthing, the Insurance Board also unveiled involvement of Aryal in a fraud case. This case was related to a company called Sumnima Hydro-transportation, in which Aryal was one of the promoters.
In this case as well, the company had demanded compensation against total loss of a jet ski being operated in the Koshi River. Sources told Republica that the jet ski had actually sunk in the Koshi River. But Aryal´s company was said to have cited the cause of total damage as fire.
"Whatever the cause of the accident, Aryal´s company had not insured the vehicle at the time when it was destroyed," the source said, revealing, "The policy was purchased from NLG Insurance only after the accident."
This case came to the fore after Sumnima Hydro-transportation demanded advance payment of around Rs 2.3 million for the damage worth approximately Rs 10.5 million.
As this case reached the Insurance Pool, which cover risks related to riots and malicious damage, it denied extending advance payment. Later, the Insurance Board approached Nepal Police to conduct investigation into the matter.
Nepal Police then asked the Central Investigation Bureau (CIB) to look into the matter, which later concluded that the case as a "sham".
"We compared details collected by the police after the jet ski accident with the report prepared by the surveyor (a person hired by a insurance company to take stock of the extent of damage). Those two reports contrasted sharply," CIB Head Kesh Bahadur Shahi told Republica.
"We, however, have no knowledge of people involved in this case. To find this out, the insurance sector regulator will have to make another request to (the head of) Nepal Police."
Aryal, in the meantime, has denied charges leveled against him. "If I had committed mistake I would have been behind bars by now," he told Republica. The person, who waged war against unruly insurance companies and launched various reform measures in the insurance sector, also clarified he has already resigned from Sumnima Hydro-transportation but confirmed he is still with Aryal Construction.
Dr Fatta Bahadur KC, chairman of the Insurance board, however, declined to make comments. "Investigations are under way. I´ll comment only after they are complete," he said.
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