Life Insurance invests 3 percent and Non-Life Insurance 5 percent in stock market

KATHMANDU, AUGUST 21: Life insurance companies have mobilized just 3 percent of their total investments in the stock market in the last fiscal year. According to data from the Insurance Authority, they invested a total of NPR 19.12 billion, with NPR 682 million of this amount allocated to the stock market.

Himalaya Life Insurance Company made the largest investment of NPR 5.66 billion in purchasing shares of other companies. This amount accounts for 8 percent of its total investment totalling NPR 65.39 billion. The second largest investment in stocks was made by Reliable Life Insurance Company, with NPR 1 billion, constituting 6% of its total investments.

Similarly, Prabhu Mahalakshmi Life Insurance and Sun Nepal Life Insurance each invested about 5% of their total investments in shares, with Prabhu Mahalakshmi investing NPR 770 million and Sun Nepal Life Insurance investing NPR 586.6 million.

The stock investments made by National Insurance Company, IME Life Insurance, and Sanima Reliance Life Insurance were NPR 2.15 billion, NPR 664.6 million, and NPR 675.9 million, respectively. MetLife Insurance Company, however, did not make any such investments.

For non-life insurance companies, NPR 3.86 billion was invested in the stock market, which is only 5% of their total invested amounts.

Among them, Prabhu Insurance topped the list in terms of share investment volume for 2023/24, investing NPR 328.6 million, which is 13% of its total investments. Similarly, Neco Insurance and National Insurance Company each invested 9% of their total investments in shares, with Neco Insurance investing NPR 550 million and National Insurance investing NPR 794.1 million.

On the other hand, Nepal Insurance Company and NLG made the lowest investments, around 1% each, in the stock market. Nepal Insurance Company invested NPR 73.2 million, while NLG Insurance Company invested NPR 40.9 million.

According to the investment directives issued by the Authority for both life and non-life insurance companies, they are allowed to invest up to 10% of their total investments in the shares of publicly listed companies authorized by the Nepal Securities Board. The directives also specify that investments in stocks should not exceed 5% of the paid-up capital of the related company.