Page 19 - The Insurance Times July 2025

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Nepal Insurers Urged to Reliable Nepal Life Extends Swiss Re Highlights Key
Strengthen Anti-Money Renewal Exemption for Lessons for European In-
Laundering Policies Life Insurance Policies Un- surers from California’s
Nepal’s insurance companies have been til July 30 $40Bn Wildfire Losses
urged to formulate and implement ro-
bust anti-money laundering (AML) poli- Reliable Nepal Life Insurance has an- Swiss Re has urged European insurers
cies and standards to align with national nounced an extension of the premium to draw critical lessons from the $40
and international compliance require- renewal exemption period for its life billion in wildfire-related losses experi-
ments. The directive comes from insurance policyholders until July 30, enced in California over the past five
Nepal’s Financial Information Unit (FIU), 2025. This means that customers years. In a recent analysis, the rein-
which has called for greater vigilance whose policies have lapsed due to non- surer pointed out that increasing cli-
amid rising concerns about the use of payment can now renew them without mate-driven catastrophes, like wild-
insurance products for money launder- facing penalties or interest charges fires, require a fundamental rethinking
ing and illicit financial flows. during this window. of risk models, underwriting practices,

Insurers are now expected to enhance The company’s decision is aimed at and mitigation strategies across Eu-
their internal controls, conduct cus- supporting policyholders who may have rope.
tomer due diligence (CDD), report sus- faced financial hardship or missed pay- The report highlights how outdated
picious transactions, and train staff to ments due to unforeseen circum- historical models are failing to capture
identify red flags. The FIU emphasized stances. By waiving late renewal the growing intensity and frequency of
that life insurance policies, in particu- charges, Reliable Nepal Life seeks to extreme weather events. Swiss Re
lar, can be misused for layering and encourage policy continuity and pro- recommends shifting towards forward-
integrating illicit funds unless moni- tect the long-term financial security of
tored closely. looking, scenario-based risk assess-
its customers. ments, integrating climate science and
The move is part of broader efforts to Policyholders are advised to take ad- satellite data to better anticipate and
strengthen Nepal’s financial system in vantage of this extended deadline by price natural catastrophe risks.
line with Financial Action Task Force visiting the nearest branch office or
(FATF) recommendations and national The reinsurer also stressed the need
contacting customer service for policy for regulatory alignment, public-pri-
anti-money laundering laws.
reinstatement. vate collaboration, and stronger in-
Insurers who fail to comply risk facing
This move is part of the company’s vestment in resilience infrastructure.
regulatory action, including fines and
license suspension. The directive un- broader commitment to customer- Urban planning, land use policies, and
derscores the growing need for a com- centric service and enhancing policy- consumer education were flagged as
pliance-first culture across Nepal’s in- holder engagement by offering flexibil- key preventive tools to reduce future
surance sector. ity and support during critical times. exposures.

The Insurance Times July 2025 17