Nepal Insurance Authority to pay Rs 1.81 billion to coronavirus insured in the first phase starting from Tuesday

Published On: November 24, 2022 09:35 PM NPT By: Republica  | @RepublicaNepal

KATHMANDU, Nov 24: After a long hiatus, coronavirus insured will be receiving the insurance coverage from Tuesday.

According to the Nepal Insurance Authority (NIA), insurance companies will be providing the insured amount to the coronavirus affected on the basis of the application date. Raju Raman Poudel, executive director of the NIA, said that the authority has taken the decision citing the inadequate amounts provided by the government to settle the insurance coverage that was put on hold for the past two years.

Two months ago, the Ministry of Finance provided a mere Rs 1 billion to pay for the coronavirus insurance cases, while the insurers received claims for around Rs 15 billion in total. Poudel said a total of Rs 1.81 billion, with the NIA contributing an additional Rs 818.10 million, will be distributed to those affected by coronavirus in the first phase.

The corona insurance, which started in April 2020 after the onset of the COVID-19 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 grants.

The COVID Insurance Directive stipulates that the insurance company is liable to pay up to Rs 1 billion, Reinsurance Company Rs 1 to 2 billion, the company’s catastrophe fund Rs 2 billion to 2.5 billion, and the NIA Rs 2.5 billion to Rs 3.5 billion. The guidelines state that the government will have the liability to pay for more than Rs 3.5 billion.

Despite the rule in place, COVID affected people had been unable to get the payment mainly after the government bodies failed to deliver their responsibilities. Of late, the Reinsurance Company has been refusing to settle the claim, stating that it has already paid its part to the insured.

As of now, a total of Rs 4.78 billion has been paid to the insured. Out of the amount, Rs 3.50 billion was maintained from the corona insurance pool. The remaining Rs 11.43 billion is yet to be settled. 

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