Nepal’s Insurance Fraud Prevention: Information Center Modeled on Credit Bureau
16th April 2025, Kathmandu
Nepal to set up Insurance Information Center to fight fraud and improve transparency, following the model of the Credit Information Bureau. The model will be similar to the existing Credit Information Bureau (CIB) used in banking.
Nepal’s Insurance Fraud Prevention
Concept Introduced in New Regulations
The concept of the Insurance Information Center is included in the new Insurance Regulations. The regulations are yet to be published in the Nepal Gazette. Once published, they will become effective. After that, the Nepal Insurance Authority (NIA) will begin the formal process of setting up the center.
The Insurance Information Center will not only be a government initiative. Both the regulatory body and insurance companies will share their ownership.
Consultation Already Started
NIA has already started working on the plan. It has held several meetings and discussions. Key stakeholders such as the Insurance Agents Association, Surveyors Association, Life Insurers’ Association, and Nepal Insurers’ Association have taken part.
These consultations have helped in shaping the center’s structure. The Authority aims to launch IIC as a public company. It will act as a one-stop platform for handling complaints and monitoring the insurance market.
A Step Toward Transparency
The center will not only address policyholder complaints. It will also track fraudulent activities. This includes insurance fraud, forgery, and document manipulation. People or companies involved in such acts will be blacklisted. Once blacklisted, they will not be able to buy new insurance policies.
Suspicious activities will also be monitored. The center will create a separate list of such cases. This move aims to make the insurance sector more transparent and reliable.
Filling an Old Gap
Nepal’s insurance sector has a long history. But it has lacked a central data system. Fraudsters often move from one company to another. Without a shared database, companies could not track repeat offenders.
The new center will fix this issue. It will store all records in one place. Every company will have access to the data. This will help prevent repeat offenses across the industry.
Modeled After the Credit Bureau
The Insurance Information Center will work like the Credit Information Bureau. CIB stores data on people who do not repay loans. Such people are blacklisted and cannot get loans from other banks.
The IIC will work the same way. It will block access to insurance services for blacklisted individuals or companies. This will stop fraudsters from misusing the system.
Next Steps
Once the regulation is published, NIA will begin the official setup process. It will create the needed infrastructure. It will also finalize data-sharing rules. Insurance companies will be asked to cooperate fully.
This center is a big step forward. It will improve trust in insurance. It will also protect customers and companies from fraud.
For more: Nepal’s Insurance Fraud Prevention
