By increasing the paid-up capital of the insurance company, the paid-up capital of the life insurance company has been increased to Rs. 5 billion and the paid-up capital of the non-life insurance company has been increased to Rs. 2.5 billion.
The Board of Directors meeting held today said that increasing the paid-up capital will increase the overall net worth, increase the risk-bearing capacity of the company and create a conducive environment for the company to merge with each other. The committee has stated that the decision has been made to increase the access to insurance by reducing the cost of services if there is large capital, to create an environment of healthy competition among the companies by maintaining large capital, and to maintain paid-up capital in line with risk-based capital.
It is mentioned that the paid-up capital should be maintained by April next year and the company which is not able to reach the required capital within that time period should maintain the capital in accordance with the 'Directive on Merger, Merger, and Acquisition of Insurers, 2076'. A statement issued by the executive director of the committee, Rajaraman Poudel, states that the company has to submit its decision on the capital plan to the committee within 30 days.
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