10th September 2025, Kathmandu
The Nepal Insurance Authority (NIA) has instructed all insurance companies in the country to implement work-from-home arrangements.
NIA Emphasises Work-From-Home
The directive, issued on September 10, 2025 (Bhadra 25, 2082), is a direct response to the ongoing political instability and deteriorating security situation. Its primary goal is to safeguard employees and business assets while ensuring the continuity of essential services through digital and remote channels. This move aligns the insurance sector with other financial institutions that have taken similar measures to protect operations during the crisis.
Enforcing Remote Operations
The NIA’s directive emphasizes the need for insurance companies to quickly adapt their operations to a remote working model. This is intended to mitigate the risks associated with the ongoing Gen-Z protests, which have at times turned violent, resulting in damage to public and private properties, including financial institutions. The circular mandates that companies enable employees to perform essential tasks from home, such as claims processing, underwriting, and policy issuance. This shift is expected to accelerate the adoption of digital platforms and cloud-based solutions, pushing the sector toward greater technological resilience.
In addition to implementing work-from-home policies, the NIA has also instructed insurers to strictly comply with the orders of national security agencies. This requires companies to cooperate with local authorities and report any unusual activities or security threats immediately. By prioritizing the safety of their staff and aligning with broader national security directives, insurance companies are aiming to reduce their vulnerability to the unpredictable nature of the unrest.
Impact on the Insurance Sector and Customers
The work-from-home directive has both positive and negative implications for the insurance sector. On one hand, it significantly enhances employee safety, protecting them from potential violence or disruptions near office premises. It also forces a much-needed push for digital transformation, which could lead to more efficient and agile operations in the long run.
On the other hand, the transition poses operational challenges. Insurers must quickly adjust their internal workflows to a remote environment, and this could lead to delays in claims processing and other services. While companies are expected to keep communication channels open through call centers, emails, and online platforms, customers may still experience slower service delivery. This could potentially affect customer satisfaction and public trust, especially for those who rely on physical transactions or in-person assistance.
The NIA’s directive is part of a broader trend within Nepal’s financial sector. Other institutions, like Jyoti Bikash Bank, have also suspended their physical operations, while Nepal Telecom has provided free services to facilitate communication. The Nepal Stock Exchange (NEPSE) has repeatedly halted trading, reflecting the deep impact the instability has had on the entire economy.
Navigating Challenges and Ensuring Continuity
Despite the challenges, the NIA has stressed that insurance companies should not completely halt operations. Instead, they are required to leverage their remote work systems to provide essential services and maintain open communication with policyholders. This approach is crucial for maintaining the sector’s reputation and demonstrating its resilience during a crisis. By encouraging business continuity through digital channels, the regulator is attempting to minimize the negative impact of the unrest on the financial system and the economy as a whole.
The situation in Nepal is highlighting the fragility of traditional business models and underscores the urgent need for a robust crisis management framework in the insurance industry. The current crisis may serve as a catalyst for change, prompting insurance companies to invest more in digital infrastructure and comprehensive risk management plans. Ultimately, the ability of the insurance sector to protect its workforce and continue serving customers remotely will be key to its survival and future growth in a changing and uncertain environment.
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