NIA Mandates Investment Units for All Nepal Insurance Companies
19th March 2025, Kathmandu
The Nepal Insurance Authority (NIA) has issued a directive requiring all insurance companies to establish ‘Investment Management Units.’ This applies to life, non-life, reinsurance, and microinsurance companies. The move aims to improve transparency and efficiency in managing investments within the insurance sector.
NIA Mandates Investment Units
Insurance companies must set up these units under the supervision of senior management staff with relevant investment experience. They are required to inform the NIA about the establishment of these units within seven days. Similarly, microinsurance companies must assign investment management responsibilities to experienced senior staff and report to the NIA within the same timeframe.
Companies that have already implemented investment-related structures must provide details to the NIA within seven days. This ensures compliance and transparency with the new directive.
The NIA’s decision focuses on enhancing oversight and accountability in handling investments. By creating specialized units, the authority aims to strengthen financial stability and protect the interests of policyholders.
This directive is part of the NIA’s broader efforts to regulate Nepal’s insurance sector effectively. It encourages companies to adopt best practices in investment management, ensuring better utilization of funds, enhancing financial stability, and safeguarding policyholders’ interests. This step strengthens trust and confidence in the industry while promoting transparency and accountability.
The establishment of Investment Management Units is expected to bring more discipline to how insurance companies handle their investments. It will also help build trust among stakeholders and policyholders, fostering confidence in the sector.
The NIA continues to enhance regulatory frameworks to support the growth and stability of Nepal’s insurance industry. This directive is a significant step toward building a more robust, transparent, and accountable financial environment. By promoting best practices and ensuring efficient fund management, the NIA aims to strengthen the sector and protect the interests of policyholders, fostering greater trust and confidence in the industry.
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