Insurance companies’ business took a beating in FY 2022/23
With the country grappling with the economic slowdown, the insurance industry has taken a significant hit in the current fiscal year. Both life and non-life insurance businesses experienced single-digit growth in the fiscal year 2022/23.
After experiencing double-digit growth in previous years, the insurance sector (both life and non-life) saw a meager increase of 2.85 percent in 2022/23, which is significantly lower compared to the robust growth of 16.48 percent witnessed in 2021/22.
The preliminary data unveiled by the Nepal Insurance Authority shows that life and nonlife insurers collected insurance premiums totaling Rs 182.88bn in the last FY. In 2021/22, the total premium collection stood at Rs 177.81bn.
The business of life insurance companies surged by 2.64 percent in the last fiscal year while non-life insurance companies saw their business grow by 3.6 percent.
According to NIA, life insurance companies collected premiums amounting to Rs 142.31 in the last fiscal year, while it was Rs 40.57bn for non-life insurance companies. The premium collection of life insurance companies in 2021/22 stood at Rs 138.64bn and non-life insurance companies at Rs 39.17bn.
Insurance sector experts have termed the growth rate of the non-life insurance business as not encouraging. The growth rate of the non-life insurance business was high in the last few years. “The non-life insurance business has been affected this year due to the economic recession and high prices,” said an official of the Nepal Insurance Authority.
Among the non-life insurance companies, Shikhar Insurance tops the chart when it comes to premium collection in this fiscal. The company collected Rs 5.52bn in insurance premiums till mid-July 2023.
Sagarmatha Lumbini Insurance is in the second position with a premium collection worth Rs 4.55bn and Siddhartha Premier Insurance is in the third position with a premium collection of Rs 4.51bn.
The insurance sector faced significant pressure last year due to various factors, including the economic slowdown, and reduced credit flow from banks and financial institutions. As a result of the sharp decline in public savings capacity, the conducive environment for long-term investment in life insurance could not be sustained throughout the year.
However, the opening of imports of luxury goods, including vehicles, enabled the expansion of business for non-life insurance companies in the second half of the last fiscal year.
Insurers say that the rise in the non-renewal and surrendering of insurance policies has dragged the business down in the last fiscal year.
related news
Nepse plunges by 14. 12 points on Wednesday
Nov. 13, 2024, 3:54 p.m.
Gold price drops by Rs 400 per tola on Wednesday
Nov. 13, 2024, 12:09 p.m.
Dedicated and trunk line: Lal Commission report reveals Rs 22bn dispute
Nov. 13, 2024, 11:25 a.m.
National grid electricity reaches Tilicho lake base camp
Nov. 13, 2024, 11:24 a.m.
Karnali aims for full electrification within 18 months
Nov. 12, 2024, 10:49 a.m.
Foundation stone laid for Pathibhara cable car amid protests
Nov. 12, 2024, 10:48 a.m.
Tourist oriented hotels being added in Mustang
Nov. 11, 2024, 10:39 a.m.
EV imports surge
Nov. 10, 2024, 12:48 p.m.
Comments