Insurance is the risk transfer mechanism between the insured and insurance company.
An arrangement by which a company or the state undertakes to provide a guarantee of compensation for specified loss, damage, illness, or death in return for payment of a specified premium.
Some of the main reasons why insurance is important are:
As per Insurance Act of Nepal, “Life Insurance Business” means the business relating to a contract regarding to the life of any person under which he/she or his/her heir in the event of his/her death, will be paid a particular amount in case a specified amount is paid in installment on the basis of his/her age.
As per Insurance Act of Nepal, Non-Life Insurance Business” means other Insurance Business other than the Life Insurance Business.
There are two types of insurance companies in Nepal.
There are 19 Life insurance and 20 non-life insurance companies in nepal.
|Name of Life Insurance companies||Name of Non-life Insurance companies|
|MetLife (American Life Insurance Company Limited)||Ajod Insurance Limited|
|Asian Life Insurance Company Limited||Everest Insurance Company Limited|
|Citizen Life Insurance Company Limited||General Insurance Company Nepal Limited|
|Gurans Life Insurance Company Limited||IME General Insurance Limited|
|I.M.E. Life Insurance Company Limited||Himalayan General Insurance Company Limited|
|Jyoti Life Insurance Company Limited||Lumbini General Insurance Company Limited|
|Life Insurance Corporation (Nepal) Limited||National Insurance Company Limited|
|Mahalaxmi Life Insurance Limited||Neco Insurance Limited|
|National Life Insurance Company Limited||Nepal Insurance Company Limited|
|Nepal Life Insurance Company Limited||NLG Insurance Limited|
|Prabhu Life Insurance Limited||The Oriental Insurance Company Limited|
|Prime Life Insurance Company Limited||Prabhu Insurance Company Limited|
|Rastriya Beema Sansthan||Premier Insurance Company (Nepal) Limited|
|Reliable Nepal Life Insurance Company||Prudential Insurance Company Limited|
|Reliance Life Insurance Limited||Rastriya Beema Company Limited|
|Sanima Life Insurance Limited||Sagarmatha Insurance Company Limited|
|Sun Nepal Life Insurance Company Limited||Sanima General Insurance Company Limited|
|Surya Life Insurance Company Limited||Shikhar Insurance Company Limited|
|Union Life Insurance Company Limited||Siddhartha Insurance Limited|
|United Insurance Company (Nepal) Limited|
As per the Insurance Regulation, 1993 A.D, Non-Life Insurance companies can do following businesses:
As per the Insurance Regulation, 1993 A.D, Life Insurance companies can do following businesses:
Premium means the Insurance Premium to be collected by the Insurer from the insured in consideration of the Insurance Business.
Reinsurance is re-insuring the portion of the risk which is excess of the risk to be hold by the Insurer.
Reinsurance is a process whereby reinsurer takes on all or part of the risk covered under a policy issued by an insurance company in consideration of a premium payment. In other words, it is a form of an insurance cover for insurance companies.
A company which insures an insurance company is known as reinsurer. Reinsurance companies are reinsurers.
Retrocession is re-insuring the portion of the risk which is excess of the risk to be hold by the reinsurer.
Insured takes the policy from insurance market through insurers, then insurers goes to reinsurance market to get reinsurance from reinsurers. Reinsurers with the help of reinsurer intermediary goes to the market with retrocession with the retrocessionaire.
There are two types of treaty.
A proportional reinsurance agreement, also known as “Pro Rata” reinsurance, obligates the reinsurer to share a percentage of the losses. The reinsurer receives a prorated share of the insurer’s premiums.
Non-proportional reinsurance, or excess of loss basis, is based on loss retention. The ceding insurer agrees to accept all losses up a predetermined level. The reinsurer agrees to reimburse the ceding insurer for losses above the predetermined level and up to the reimbursement limit provided for in contact.
Ministry of Finance.
3rd floor, LS Building, Thapathali, Kathmandu, Nepal
Nepal Re provides the services for facultatve and treaty reinsurance for fire, property, engineering, aviation, marine, agriculture, miscellaneous and motor portfolios along with different kind of pools such as covid, RSDMDST etc.
2077/03/15 (29th june 2020).