The business of life insurance companies increased nominally as of mid-October in the current fiscal year. Despite the rise in collection of new business premium, a decline in renewal or insurance policies affected the overall business.

According to data published by the Nepal Insurance Authority (NIA), 14 life insurance companies, excluding smaller ones, collected Rs 41.8 billion in insurance fees from the sale and renewal of policies by mid-October of the current fiscal year, which is an increase of just 0.68 percent compared to the corresponding period of last fiscal year.

As of mid-October this year, companies collected Rs 8.15 billion from sale of initial insurance premiums, and Rs 32.92 billion from renewal of insurance policies. In the same period last year, they had collected Rs 6.71 billion from first-year premiums and Rs 34.8 billion from renewals. Compared to last year, the inception premium collection increased by 21.46 percent, but the renewal collection decreased by 3.4 percent.

In the period of mid-September to mid-October of the current year alone, companies collected Rs 8.45 billion from renewals and Rs 2.60 billion from sale of initial premiums. In contrast, during the same period last year, companies collected Rs 2.38 billion by issuing first-year premiums and Rs 9.28 billion from renewals. This shows a 9.28 percent increase in initial premium collection compared to last year, but an 11 percent decline in renewals. 

Nepal Life Insurance Company recorded the highest collection of Rs 11.9 billion till mid-October. On the other hand, Sun Nepal Life Insurance reported the lowest collection, amounting to Rs 932.7 million. 

The insurance fee collection of Rastriya Beema Company decreased by 65.35 percent compared to last FY, while that of Himalayan Life Insurance fell by 1.57 percent. According to Sushil Dev Subedi, spokesperson for NIA, the business growth of insurance companies remains moderate as economic activities have not expanded significantly. He added that the limited business expansion is mainly due to the decline in policy renewals. 

Additionally, in the first three months of the current FY, small life insurance companies collected Rs 221.3 million in premiums. However, NIA reported that the insurance fee collection by these companies last year stood at Rs 307 million.