Life Insurance in Nepal is a contract regarding the life of any person in the event of the death or disability a particular amount will be paid to the nominee.
Life insurance business in Nepal has been growing remarkably over the last decade. As more people are aware of insurance, many companies have established local and some international companies have also started their business in the insurance market in Nepal.
Nepal Insurance Board is the government agency that regulates all types of insurance companies in Nepal. It issues, renews, and revokes the companies’ license and approved the foreign firm to operate in the country.
How many life insurance companies are there in Nepal?
There are 19 life insurance companies, including three foreign insurers, 20 non-life insurance firms, a dozen, health Life insurance firms.
Life insurance corporation not only provides for people’s life insurance but also has other non-life insurance and health insurance divisions that work within that market.
What are the life insurance products and services in Nepal?
Most life insurance firms offer similar products but with different bonus rates and varying time frames. Here are popular products that life insurance companies offer to the insured in Nepal;
- Fixed Term insurance: Individuals can buy insurance plans that may range from 1 year to 30 years+. If something has happened to be covered by the insurance policy, compensation shall be paid to the family member or relative.
- Money-back plan: this plan offers a survival benefit. A fixed percentage of the Sum Assured returns during the payment period of the premium. The premium is refunded after the insured has paid 3 or 5 installments, depending on the company.
- Life term insurance: The insurance provider will pay a monthly payment for the rest of the life of the insured after maturity. However, the payment will stop after the beneficiary passway even the original death benefit has not fully paid yet.
What are the benefits of life insurance in Nepal?
- Death benefits: Upon the death of the policyholder within the policy term or after the maturity, full sum assured+bonus is paid.
- Maturity benefits: Full sum insurance+ bonus will be paid to the insured at the end of the term.
- Loan facility: The insured can borrow up to 90 percent from the insured sum after paying 2 installments.
- Tax benefits: Nepal government does not charge any taxes on the premium you will pay and assured amount.
- Additional benefits: depending on the insurance plan;
- Accident Double Benefit
- Permanent Total Disability Benefit
- Premium Waiver
- Monthly Income Benefit
Why life insurance is important in Nepal?
- Getting risk cover against the unfortunate event
- Achieving life stage needs
- Long term investments
- Wealth creation
- Cover against illness and accidents (Depending on plan opted)
- Coverage against liabilities
- Retirement planning
- Tax benefits as per prevailing tax laws
What documents require for life insurance?
- completely filled insurance Application Form
- Health Declaration Form
- Medical Examiner’s Report
- Insurance Agent Form
- Age Proof Document
- Citizenship Certificate or
- Birth Certificate in the case of Minor
What is the age limiting for life insurance in Nepal?
- Minimum 1year old for child insurance
- 16 to 65 years old for adult insurance.
Can a foreign national buy insurance package in Nepal?
No, only the Nepal citizen can purchase the life insurance packages from any insurance companies in Nepal. NRN (Non-Resident Nepalese) or migrant workers eligible to insured themself.
What to do if there is any dispute for compensation?
You can lodge a complaint with the Nepal Bima Samiti or Nepal Insurance Board (BID) against the insurance company. The Insurance Act of Nepal is very stringent with the business that does not comply with the policy, and you will get justice.
Who can not do life insurance in Nepal?
- A person that is not good at the mental stage.
- Foreign national
- A person is over 65 years of age.
- A person working in military and police departments.
Life insurance in Nepal is very important to everyone, whether they work in Nepal or abroad because it can cover the unforeseen risk that could arise in our daily lives. Although life insurance can not save our lives, it could provide some financial assistance to our loved one after our life loss.
The insurance also provides the education packages for the children and premium waiver benefits until the maturity, if they lost their parent who has life insured with the company.