“Now more than ever, insurance companies need to be especially proactive when settling claims,” Vivek Jha, chief executive officer of Nepal Life Insurance Company (NEPAL LIFE), says, “This is the right time for insurance companies to earn the trust of the people.”
Once the dust settled after the earthquake, startling figures emerged as to how many people had taken up any life insurance. Out of almost 9000 deaths, only around 250 people were insured. In the capital alone, not even 5% of the total population had taken up insurance, as per the claims received till date.
The general mood among business insiders after the earthquake was that the insurance companies were going to be the hardest hit, as the feeling was that they were not fully prepared to pay off the claims.
But according to Vivek Jha, chief executive officer at one of the country’s top insurance companies, Nepal Life Insurance Company (NEPAL LIFE), his company was already prepared for such a disaster. “We were initially prepared for this kind of disaster, as we knew that our country lies in an earthquake prone area and that there could be a huge impact. So we were ready to pay off the claims of at least 4000 people equivalent to NPR 4 billion through reinsurance,” he said.
The company’s approach after the natural calamity was to contact their clients directly. “We contacted our clients before they came to us,” he said. The company claims to have settled almost every claim they received. Till now the company has received and settled 35 claims amounting to 2.13 crores. Most of the claims have been settled in the same day. Nepal Life has also been providing door to door service, reaching out to the insured.
He also emphasized that now, more than ever, insurance companies need to be especially proactive when settling claims. “This is the right time for insurance companies to earn the trust of the people. People should feel that insurance is for them,” he said.
Some industry watchers believe that the earthquake has forced people to change their views about insurance. People are now more than willing to find out who is eligible for insurance, and what type of risks insurance covers. “Now communication has become a two- way street, whereas before, people used to do insurance through the insistence of agents. So we should grab this opportunity,” said Jha.
To break the general public’s uncertainty about insurance, NEPAL LIFE is planning to introduce smaller, more affordable policies.
Jha also pointed out that the insurance industry in Nepal is still in its infancy. “Dramatic growth is still to come in the near future,” he said, adding that, “only 7% of the country’s population is insured. With some also having multiple insurance, the result percentage of insured may be even less.”
About the Company
Back in 2001 when NEPAL LIFE was formed, there were only two companies dealing with life insurance business in Nepal. The company rose out of the growing need felt by business professionals to harness and safeguard Nepal’s expanding economy on an international footing.
NEPAL LIFE became the first fully Nepali owned insurance company dealing in life insurance services by private sector. The company currently has a reinsurance policy with the German Hannover Re-insurance Company which is the fourth biggest reinsurance company of the world.
To date, the company has a paid-up capital of NPR 1.734 billion. Presently, NEPAL LIFE provides a bonus rate of Rs 65-82 per thousand sum assured per annum, which the company claims is the highest among life insurance companies in Nepal and in South Asia.
Nepal Life has a network of more than 12,000 active agents who provide services to people from all over the nation.
The company also owns one of the finest malls, Nepal Life City Center which was also the first highly sophisticated mall in the country. This commercial facility has been contributing handsomely to the annual profit of the company. Nepal Life has also won the Newbiz Business Conclave’s Best Life Insurance Company title for two consecutive years in 2013 and 2014, respectively.
Within fifteen years NEPAL LIFE has managed to create an excellent business record setting up a strong financial position for itself. Four years ago the company had a market share of almost 21-23% which has now doubled to 44%. “We looked for the untapped market and cashed in there,” said Jha. Compared to last year the business this fiscal year has had an impressive growth of around 75% till date.
The company has a presence throughout the nation with almost 100 outlets including 5 regional offices, 29 branches, 60 sub-branches in the major cities and is aggressively looking to expand its services.
In its fifteen-year journey, the insurance company has been active during times of crisis. This time too, it donated Rs 5.1 million to earthquake victims via the Prime-Minister’s Disaster Relief Fund through the Bima Samitee. “We had also helped during the floods. We are thinking to increase our CSR activities in the future,” said Jha.
The present financial condition of Nepal Life is very sound which can be understood from the following figures:
NEPAL LIFE has launched different life insurance policies to suit various segments which are as mentioned below:
Child Education Plan, Keta-Keti Jeevan Bema, focus on children and securing their future for proper education and other social liabilities.
Surakshit Jeevan Beema Yojana is one of the most reasonable policies available in the market and hence very popular.
Jiwan Laxmi Beema Yojana is a triple benefit policy targeted at lower income groups covering high risk.
Jeewan Sarathi is a joint life insurance policy for married couples where one policy covers the risk of two lives.
Jeewan Sahara (endowment cum whole life) is one of the best policies available with the company.
Anticipated Endowment Policies:
Naulo Dhanbarsha Plan &Naulo Jeevan Sambriddhi are limited payment money back policies that ensure one of the best returns apart from securing one’s life.
Term Life Policies
Normal term life is targeted towards groups as well as individuals and can be purchased for lowest cost.
Foreign Expat Term Life Insurance Policy is done by Nepalis going abroad for employment and it is compulsory as per the government rules.
Popular HR Policies
According to the company, one big reason why it attracts many top class candidates is because of its popular organizational setup. To retain company workers and to broaden their skills, the company also regularly provides in-house and overseas training to its employees. The company has been exposing its employees to the international insurance culture and industry by sending its employees to countries like Australia, Malaysia, Singapore, India and Japan etc.
NEPAL LIFE is also making a determined effort to strategically work with different international insurance companies like Nippon Life, Samsung Life, Cathay Life etc. “With this linkage we are planning to become South Asia’s one of the best life insurance companies and to ultimately, make our mark throughout Asia,” said Jha.
- Highest bonus rate
- Stick to basic and fundamentals
- Customer focused
- Capable and young human resources (avg. age 25-26)
- Professional and dedicated agency force
- Professional board of directors
- Well governed – follow international best practices and corporate governance
- Decentralized – operations through regional, branch and sub-branch offices for efficient services
- Introduction of new and contemporary policies
- Sound online support
Weaknesses/Areas to Improve
- Always room for improvement as time is changing
- Online premium payment but it is a generic problem for all the companies due to limitations of availability of online payment system.
- Untapped Market
- Less competition
- Increasing market Create awareness
- New products
- Cross border premium repatriation (Though on a decreasing trend)
- Political instability in the country