June 24:  The Insurance Board (IB), the insurance sector regulator has changed the foreign employment (term) life insurance premium. IB Director, Shreeman Karki informed that the insurance premium rate that was fixed to be implemented from mid-April has been decreased by 20 percent. According to him, the premium cost has been decreased as the IB has barred insurers from extending agent commission on sales of foreign employment (term) life insurance policies. The Board took the decision to free foreign job seekers from financial burden of agent commission, as the foreign job-seekers are usually of low income level.

The IB’s latest move comes almost two-and-a-half months after it doubled the coverage amount of foreign employment policies to Rs 1 million from Rs 500,000. Although the policy’s coverage had been hiked by 100 per cent, the premium cost was raised by only 65 per cent at that time. Although the premium rate has been decreased from mid-July, the insurance amount compensated to the nominee after the death of the policy owner has remained the same.

After the implementation of changed system from April, the policyholders became entitled to compensation of Rs one million in case of death in foreign land. Before April, the amount was only Rs 5, 00,000. The decision was taken according to the recommendation made by Foreign Employment Promotion Board. However, the insurance premium differs based on age of foreign job aspirants and the tenure of the policy.