Insurance Companies Preparing for Rights Issues to Meet Capital Requirements

The Nepal Insurance Authority's directive for insurance companies to increase their paid-up capital has seen various responses. Despite several extensions to the initial deadline, many companies are still working towards meeting the regulatory capital requirements through the issuance of rights shares. Below is a detailed look at the current preparations by both non-life and life insurance companies.

Current Issues and Delays

Despite the preparations, some companies are facing delays due to the lack of timely approvals from the Securities Board of Nepal (SEBON). The board has been without a chairman since Poush, leading to a halt in approvals for new rights issues. This has created a bottleneck for companies that depend on rights issues to meet the capital requirements set by the Nepal Insurance Authority.

Conclusion

While many insurance companies have made significant strides towards meeting the capital increase mandates, the delays in obtaining necessary approvals from SEBON have posed significant challenges. The Nepal Insurance Authority has assured that the majority of companies are on track to meet the capital requirements, yet the timely resolution of these approval delays remains crucial for the industry to comply with regulatory standards..