Insurance companies have increased their investment in securities listed on the Nepal Stock Exchange (NEPSE).

According to data released by the Nepal Insurance Authority as of mid-January in the current fiscal year, both life and non-life insurance companies have expanded their investments in the secondary market.

The data shows that 12 non-life insurance companies have invested over Rs 4.39 billion in listed securities by mid-January 2025, marking a 26.32 percent increase from the Rs 3.47 billion investment recorded in mid-January 2024.

Similarly, life insurance companies have also significantly raised their stock market investments. By mid-January 2025, 13 life insurance companies had invested over Rs 25.77 billion in the secondary market, up from Rs 19.12 billion a year earlier—an increase of 34.74 percent.

Under existing regulations, insurance companies are permitted to invest up to 10 percent of their total investments in ordinary shares of listed companies. However, they have yet to fully diversify their portfolios as outlined in the guidelines.

Insurance companies are allowed to invest up to 25 percent in savings or bonds issued by the three tiers of government and the central bank and up to 30 percent in fixed deposits at commercial banks and infrastructure development banks.

Currently, the majority of insurance company investments remain concentrated in fixed deposits of banks and financial institutions, followed by bonds and stocks.

According to the Insurance Authority’s second-quarter financial statements for the current fiscal year, non-life insurance companies had invested Rs 46.63 billion in fixed deposits of Class A banks by mid-January 2025. Non-life insurers have yet to invest in real estate. Meanwhile, life insurance companies have invested Rs 499 billion in fixed deposits.