The Nepal Insurance Regulatory Authority issued a supervisory instruction to all licensed life and micro-life insurers to improve disclosures for loans made against the security of insurance policies. Insurers must now ensure policyholders receive advance information on outstanding amounts, interest calculation and repayment expectations before interest payments fall due. The instruction follows complaints that insurers have not provided sufficient information on the outstanding loan amount and the method of interest calculation during the loan period, with the amounts ultimately deducted from claim proceeds. Insurers are required to notify the insured at least thirty days before the expiry of the interest payment period, via email or letter, clearly stating the loan amount, the method of interest calculation, the repayment schedule, and the consequences of failure to provide information.
Nepal Insurance Regulatory Authority 2025-09-08
Nepal Insurance Regulatory Authority instructs life insurers to give 30 days’ notice on policy-backed loan balances and interest terms
The Nepal Insurance Regulatory Authority has mandated all licensed life and micro-life insurers to enhance disclosures for loans secured by insurance policies. Insurers must inform policyholders of outstanding amounts, interest calculations, and repayment expectations at least 30 days before interest payments are due. This directive addresses complaints about insufficient information provided during the loan period.