Kathmandu. Nepal Insurance Authority (INSURANCE) has sought details from insurance companies regarding employee administration and financial administration bye-laws.
Under the provisions of Sub-sections 1 and 2 of Section 8 of the Institutional Good Governance Guidelines 2080 issued by the Authority, both these documents have to be approved by the Insurer from the Nepal Insurance Authority.
Although some insurers had prepared and implemented new bye-laws and procedures, they had implemented them without completing the process of approval and certification from the AUTHORITY as per the provisions of the directive.
The AUTHORITY does not have records of which insurers got the rules and procedures approved by the AUTHORITY. Some insurers have submitted the Employees Administration Bye-laws, although the AUTHORITY has approved the conditional approval, but they have implemented it without amending it as per the directives of the AUTHORITY.
In addition to the Institutional Good Governance Guidelines, the Directive on Stable Purchase and Sale of Insurers 2081 also contains some provisions related to economic administration procedures. Section 9 of this procedure provides that the insurer should make provisions regarding the purchase and sale of fixed property in the Financial Administration Bye-laws.
According to this directive, some insurers have not yet made clear provisions regarding the purchase, construction and sale of fixed assets in their purchase and financial administration bye-laws.
There is also a provision that the insurer should include provisions related to strengthening the internal control system related to the purchase and sale of fixed assets while preparing the fixed asset purchase and sale procedure.
The provisions of the Employees Administration Bye-laws are not in conflict with the provisions of the prevailing Labour Act, institutional good governance guidelines of the insurer and the provisions of the prevailing practice, and to ensure that the bye-laws are effective to maintain financial discipline, the Financial Administration Bye-laws should also be approved by the AUTHORITY.
