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Insurance Premium up by 28 Percent

  1 min 10 sec to read

July 26: The insurance premium of non-life insurance companies has increased by 28 percent in the fiscal year 2073/74. Records maintained by the Insurance Board till mid-July show that the insurance premium of 17 non-life insurance companies has increased.

Insurance premium is the amount that the companies charge the insurance policy holders for taking risks. The insurance premium rate is determined after analyzing the probability of profit and other managerial costs depending on the type of insurance policy.

The increase in insurance premium has been attributed to the rise in number of insurance policy holders. The insurance premium earning of non-life insurance companies totaled to Rs 14.93 billion in the fiscal year 2015/16. The earnings reached Rs 19.18 billion in the fiscal year 2015/16.

According to Insurance Board Director Rajuraman Poudel, only 12 percent of the total population of 29.05 million Nepalis have purchased life insurance policy.

“Our target is to make insurance accessible to 25 percent of the population,” said Poudel, adding that the latest indicator including the increase in number of policy holders suggests that their target is not far away.

According to Poudel, expansion of industries as well as increase in political and financial activities result in increase in the demand for insurance. Poudel expects the demand for insurance to grow in the coming days when the government invests in all 744 local units in the new federal set-up.

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