Kathmandu. The number of victims who have been cheated by the representatives of life insurers is on the rise again. The keen of the workers in foreign employment(insured) have been cheated as the Nepal Insurance Authority has failed to regulate the payment of death claims in such a way that the family members of the insured do not suffer or suffer.
The insurance companies tendency of releasing a small portion of the death claim and holding majority of the claim payment for new life insurance has increased rapidly.
Most of the victims who come to receive the death claim payment of foreign employment insurance are women. They had rarely seen or visited the insurance company’s office in their life. Therefore, since they are unaware of the claim process. They reach the life insurer’s office with some relatives or helping hands to facilitate the claim of insurance.
Before the process of filing the application form to pay the claim amount begins, the employees of the insurer initially influence the middleman (a relative or acquaintance who comes with him). They are offered ‘bribe’ that will be managed from the agency commission, further they may be offered additional amount which will be managed from agency incentives. With such offer the acquaintance turns into a middleman and compels thee victim for a new life insurance and the rest of the game starts from here.
Instead of releasing full payment against death claim, the middleman convince and even compel the victim to get a new life insurance, and the agent or insurer’s employee is also involved in it.
The workers wife or mother, who came to the city or or urban market from remote village leaving their infants, elderly in-laws in the village to collect the claim money cannot afford to take shelter in the city for many days. And they are forced to fill up the insurance proposal form as per the pressure of the middlemen and insurers and return home by leaving more than half of the claim amount in the bank account of the life insurer.
Life insurance sector is infamous:
Life insurance employees and agents trying to find a shot-cut way to get a business has brought disrepute to the insurance sector as a whole. On the other hand, those who are in pain due to the loss of a family’s guardian suffer when the lump sum amount is denied the opportunity to do a small business, repay a loan or use it for any other work.
In a country like ours with poor financial literacy, life insurance is not easy. For this, the representative or agent of the insurer has to work hard to convince the insured, to prepare him mentally. Now due to economic slowdown and inflation, the common people have stopped saving enough even in the villages. On the other hand, unhealthy competition among life insurers has also reached its peak. For this reason, instead of looking for new potential insurers, those who come to receive claim payments are on the easy path of getting life insurance by taxing them.
Life insurers, which opened after 2074 BS, do not miss ‘tax cut insurance’ even when paying death claims and companies older than that pay mature claims. If there is no fixed deposit insurance of a certain amount out of the claim payment amount, they are forced to take term insurance to pay the annual installment.
Role of provincial offices:
Despite the presence of a provincial office set up by the Nepal Insurance Authority (NEA) for the protection of the insured at the state level, the practice of cheating the insured or service provider has not stopped at the life insurer’s office within a few kilometers from the AUTHORITY’s office. Despite being aware of the subject of ‘conversion’, the officials in charge of the AUTHORITY are doing it as if they are unaware.
On April 19, 2081, the Regulatory and Money Laundering Branch of the AUTHORITY stated that the life insurer should pay the insured or entitled in accordance with the law for the payment of the claim.
The insurer has not complied with the directive not to adjust the amount by issuing other insurance policies without depositing the amount in the bank account of the insured or entitled. There is still a tendency to issue a cheque in the name of the insurer from the insured or entitled without payment of the claim amount and after that, the claim amount is paid and the amount is transferred from the bank to the account of the insurance company.
In order to prevent such bullying, it will be possible to curb tax deduction insurance to some extent if the authority implements the provision that the life of the concerned beneficiary or his family should be insured only after at least seven days of payment of the claim in the case of payment of death claim of foreign employment insurance.
The more bullying the insurer does, the more the regulator has to micro-manage. The victim can feel the presence of the regulator only if the Authority can monitor the details of death claim payment against foreign employment insurance..
The District Administration Office, Morang handed over the application of the insurance claim to the police without informing the Koshi State Office of the Nepal Insurance Authority in Biratnagar. It is ironic that a wing of the Ministry of Home Affairs avoids the insurance regulatory body, Nepal Insurance Authority.
