The Nepalese government recently issued regulations mandating that insurance companies in the country offer microinsurance policies in an effort to provide access to affordable insurance for poor people. The regulations state that microinsurance policies must make up no less than 15 percent of the total policies sold by insurance companies by 2018 [1]. The regulations aim to enable a large sector of the Nepalese population to access short-term insurance policies covering health problems, accidents and crop and livestock loss. The single premium cost per policy owner will not exceed NPR 100,000 (USD 1,017) per year [1].
The current regulations establish six portfolios for microinsurance, including insurance policies for cattle, self-employment, health, personal accidents, as well as term and endowment life policies [1]. One of the regulation guidelines states that holders of agricultural insurance policies will receive a 50 percent subsidy from the government on all premiums paid. Cattle insurance policies reportedly have been “quite successful,” having generated NPR 23.6 million (USD 240,000) as of mid-April 2013 [1].
Less than five percent of the Nepalese population reportedly has insurance.
By Anesa Kratovac, Research Associate
Additional Sources and Resources:
[1] The Himalayan website article, August 21, 2013, “Microinsurance to be mandatory soon,” http://www.thehimalayantimes.com/fullNews.php?headline=Microinsurance+to+be+mandatory+soon&NewsID=388175&a=3
MicroCapital.org Article, August 28, 2013, “MICROCAPITAL BRIEF: Bharti Airtel, MicroEnsure Launch Mobile Microinsurance Service in Africa,” https://www.microcapital.org/microcapital-brief-bharti-airtel-microensure-launch-mobile-microinsurance-service-in-africa/
MicroCapital.org Article, August 14, 2013, “MICROCAPITAL BRIEF: IndiaFirst Life Insurance to Offer Pension Products and Microinsurance,” https://www.microcapital.org/microcapital-brief-indiafirst-life-insurance-to-offer-pension-products-and-microinsurance/
MicroCapital.org Article, August 6, 2013, “MICROCAPITAL BRIEF: Nepal Rastra Bank (NRB) Announces Regulations on Microfinance Institutions (MFIs) in Nepal to Increase Financial Inclusion of the Unbanked,” https://www.microcapital.org/microcapital-brief-nepal-rastra-bank-nrb-announces-regulations-on-microfinance-institutions-mfis-in-nepal-to-increase-financial-inclusion-of-the-unbanked/
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