While the profits have grown, the overall business of life insurance companies saw a marginal growth in this fiscal year. According to Nepal Insurance Authority (NIA), life insurance companies collected premiums amounting to Rs 71.65 billion in the first six months of the current fiscal year. The premium collection of life insurance companies during the same period of the last fiscal stood at Rs 70.91 billion.
According to insurance companies, their profits may increase further after the actuarial valuation. However, such an assessment will be done after the completion of the fiscal year, during which up to 10 percent of the insurance fund can be transferred to the profit and loss account. Nepal Life Insurance Company has topped the chart in terms of net profit earnings. The company posted a net profit of Rs 440 million in the first half of the current fiscal. Sun Nepal Life Insurance came second with a net profit of Rs 353 million followed by Surya Jyoti Life Insurance with Rs 284.1 billion. According to insurers, their profits improved in this fiscal mainly due to the high-interest rates of banks and financial institutions. Insurance companies keep most of their investable capital in fixed deposits of commercial banks. Banks have increased the interest rate of deposits due to a prolonged liquidity crunch, as a result, the income of insurance companies has increased which contributed to a growth in their profits.
