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In five years, the company has earned Rs. 42.04 billion in first insurance premiums, while the surrender claim has reached Rs. 26.29 billion.
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Surrender claim payment amounted to 63 percent of the first insurance premium income in five years.
Kathmandu. The amount of surrender value in life insurance company, Nepal Life Insurance is increasing rapidly. The growth rate of the amount of insurance policy forfeited before the expiry of the period or the amount of money withdrawn by the insured is more than twice the growth rate of the insurance policy.
According to the data published by the Insurance Authority of Nepal, the financial year 2077. 78 to 2081. In the five years till 1982, the company has paid a total of Rs 42.04 billion in the first insurance premium, while Rs 26.29 billion has been paid as surrender value. During this period, the premium surrender claim amount accounted for 63 percent of the first insurance premium. While collecting new (first) insurance premiums is important for the business continuity of the company, the surrender claim amount accounts for about 63 percent of the situation.
According to the data published in the Insurance Statistics Book published by the Insurance Authority of Nepal, the financial year 2081 of the company. The amount of surrender claims in 82 years is Rs 8.10 billion. This amount is 74 percent of the first insurance premium collected by the company in the same year. Not only this, the company’s first insurance premium income has increased by 37 percent in the same year, while the insurance policy surrender claim payment has increased by 79 percent.
FY 2077. Surrender value of Rs. 3.85 billion in FY 2078. It increased to Rs. 5.10 billion in FY 2078. Subsequent years were FY 2079. Rs. 4.78 billion in FY80 and Rs. 4.78 billion in FY 2080. In FY 2081, it fell to Rs. 4.53 billion in FY81. In FY82, the amount increased drastically to Rs. 8.10 billion.
Looking at the five-year data, there has been a big fluctuation in both the insurance policy surrender amount and the new insurance premium collection of Nepal Life. FY 2078. 79 to 2079. The surrender value claim amount remained at a high level as the new business income decreased by 80 years, due to which the surrender value claim amount remained at a high level in FY 2079. In 80, an amount equivalent to 71.83 percent of the new business insurance premium was excluded from the surrender value payment.
FY 2081. Although the company achieved business growth by collecting Rs 10.98 billion in first insurance premiums (income from new business) in 2018-19, the surrender amount increased by 78.59 percent to Rs 8.10 billion compared to the previous year.
In the financial statement published by the company, it is mentioned that the amount of forfeiture of the insurance policy has also been included in the amount of the surrender price. The insured has inadvertently lost the right to the insurance policy as the company did not inform the insured to pay the interest amount on time to pay the amount of the loan.
The company’s five-year data shows that despite the growth in the company’s new business, the surrender rate of old policies is very high. In an insurance company, the surrender of the insurance policy increases even if the agent sells the insurance policy of more than the insured’s purchasing capacity, does not suggest the purchase of the insurance policy according to the needs of the insured, or if the insured’s trust in the life insurance company is weak.
