October 10: President Bidya Devi Bhandari has authenticated the bill related to insurance which was conceptualized by the government to regulate the insurance sector with an innovative approach.

The Insurance Bill 2079, which was passed by both the houses of parliament – House of Representatives and the National Assembly – before the Dashain festival, was authenticated by the head of state on Sunday, October 9.

The bill authenticated by the president will become an Act once it is published in the Nepal Gazette.

The new Act will transform the Insurance Board into the Insurance Authority of Nepal. The terms of the chairman of the board and other members will get continuity in the newly-formed authority. There is a provision in the new Act that the chairman and members of the Insurance Board will automatically hold the same posts in the authority until their term expires.

The then Finance Minister Dr Yuvraj Khatiwada had registered the Insurance Bill in parliament four years ago to amend and consolidate the laws related to the insurance sector. However, the discussions on the bill was halted for a long time after a dispute regarding the continuity of the terms of the chairman and board members of the Insurance Board surfaced. The parliamentarians submitted 85 amendments to the original bill while the finance committee amended 124 points and submitted it to the parliament.

In the original bill, there was a provision that all the responsibilities, including the management of staff of the board, would go to the proposed authority, which would also have a new chairman and director. The then president Chiranjeevi Chapagain opposed this provision. However, the amended bill has a provision to give continuity to the directors including the chairman of the current Insurance Board in the newly formed authority.

Similarly, the bill also has a provision to establish an insurance development fund to increase access to insurance in rural areas as well as among the poor and underprivileged.

Surya Prasad Silwal, chairman of the Insurance Board, believes that a new era will begin in the insurance sector of Nepal after the implementation of the new Insurance Act. "The Act of 2049 has not been able to cover the latest developments in the insurance sector," he had said in an earlier interview with New Business Age.

The President’s Office on Sunday issued a statement confirming that the Insurance Bill along with other two bills were certified as per Article 113 (2) of Constitution of Nepal.    

The other two bills certified by the president include the bill to amend and integrate laws on management of public debt and the bill to manage animal health and livestock service entrepreneurs' council.