Insurers unable to meet big insurance claims, seek support from reinsurers

Kathmandu, Sept. 14

Non-life insurance companies have expressed their inability to immediately settle large insurance claims arising from physical and other damages caused during the recent protests.

According to the insurers, they can promptly pay out small claims, but in the case of larger claims, reinsurers will need to provide advance payments in order to facilitate liquidity management.

At a discussion organised by the Nepal Insurance Authority (NIA) on Sunday regarding the impact of physical and other damages on the insurance sector during the protests, chief executive officers of non-life and reinsurance companies have said that they will not be in a position to settle the large claims immediately.

While the damage assessment work is underway, the damage to the property and business is estimated at hundreds of billions of rupees. Tourism sector alone has witnessed a loss of about Rs. 25 billion, according to the industry experts.

Hundreds of government structures including federal and provincial ministries, parliaments, local bodies and ward offices, houses of leaders, hotels, cable cars, business complexes and supermarkets were vandalised and torched. Hundreds of government-owned and private vehicles were vandalised and torched.

There are 14 non-life insurance and two reinsurance companies and 1,249 surveyors in Nepal.

According to a statement of the NIA, the CEOs said survey reports could not be obtained in cases where physical property was completely destroyed during the protests due to exceptional circumstances.

Since ward offices and police stations have also been damaged, it has become difficult to obtain official recommendations, so the insurers have demanded that claim settlements be arranged on the basis of minimal documentation.

Similarly, CEOs of reinsurance companies stressed that data must be reliable when insurers make reinsurance proposals. They assured their readiness to provide necessary support in matter of claim settlements.

Meanwhile, the authority is introducing simplified procedures for claim settlements in cases of losses caused by non-natural disasters. It has therefore requested CEOs of insurers and reinsurers to provide feedback and suggestions within three days.

Sushil Dev Subedi, Executive Director of the NIA, directed insurers to ensure that the public remains confident that insurance claims are payable once insurance is purchased. He instructed the companies to appoint focal persons for data collection and to facilitate claim settlements, and to make this information publicly available.

He further instructed insurers to promptly inform policyholders if they become aware of damages to insured property or assets, and to take initiatives to advance the claim settlement process accordingly.

In another discussion, the Insurance Surveyors’ Association called for arrangements to submit survey reports on the basis of minimal documentation, taking into account the current difficult situation, and demanded that surveyors be given easy access to damaged sites.

They also stressed that survey work should be allocated proportionately and that surveyors should be made more accountable.

In response, Executive Director Subedi clarified that surveyors can continue to work effectively even under current circumstances based on the licences they have obtained.

 Published in The Rising Nepal daily on 15 September 2025.