April 29: The Insurance Board of Nepal (IBN) has agreed to review the minimum insurance premium rate for engineering (non-tariff) amid pressure from the agitating construction and energy entrepreneurs. 

The board has formed a task force under the coordination of its executive director Raju Raman Poudel for this purpose.

The board has moved ahead with the process of reducing the minimum premium rate of engineering insurance by conducting necessary study. 

The task force includes representatives from the Federation of Contractors’ Association of Nepal, Independent Power Producers’ Association of Nepal (IPPAN), Nepal Insurers’ Association and Reinsurance Company, Federation of Nepalese Chambers of Commerce and Industry, Federation of Heavy Equipment Entrepreneurs’ Association of Nepal, Ministry of Urban Development, Ministry of Physical Infrastructure and Transport, Public Procurement and Monitoring Office, Nepal Surveyors’ Association. 

The board has already written to these bodies to send their representative for the study. The task force has been given seven days to conduct the study. The task force will study the issue of revising the insurance premium rate of engineering insurance. Based on the study, the task force will submit a report with recommendations to the board. 

The minimum rate of engineering insurance will be reduced as per the suggestion in the report.

“It's very challenging to reduce the minimum rate. However, businessmen in the targeted areas have been protesting,” said Poudel, adding, “We are making an attempt to resolve this issue by conducting necessary study. The rate may be reduced after the study.”  

Similarly, the new insurance regulation will not be applicable during the study period.

The board had issued a directive on September 22, 2020 and fixed the minimum rate of such insurance. 

Following the decision, the promoter companies and construction entrepreneurs started protesting.

They also surrounded the office of the Insurance Board at Kupondole, Lalitpur after which the board reached an agreement with the agitating sides to form the task force. Meanwhile, the protest of construction and energy entrepreneurs has been postponed for the time being.

Chairman of the Insurance Board Surya Prasad Silwal said that an appropriate decision would be taken on the basis of the report submitted by the task force.