Page 20 - The Insurance Times September 2025

Future for Life Insurance

Nepal's Shift to Risk-

Based Capital:

Building a Resilient

Future for Life

Amit Kumar Keyal
Insurance Nepal Life Insurance Co. Ltd.
Deputy CEO

RBC is not just a compliance hurdle. Done right, it is Nepal's chance to align solvency with strategy,
efficiency with resilience, and finally separate insurers that are merely surviving from those that
are truly building for the future.

Global perspective: Do insurance Have life insurance companies actually failed? The answer
is "yes". Over the past 24 years, 324 life insurance
companies fail? companies worldwide have collapsed-an average of 13 each
Life insurance is one of the few promises which is designed year according to PACICC (Property and Casualty Insurance
to outlast generations. For that promise to endure, the Compensation Corporation). These failures were not
financial strength of insurers must be as resilient as the confined to any specific geography or business model; they
commitments they make. Yet in today's volatile have been a global reality.
environment, insurers themselves are vulnerable to the
failures. The reasons are well known as poor risk selection, mispriced
products, inadequate
reserving, reinsurance
defaults, fraud, and
overly complex
structures. Historically,
such weaknesses eroded
the solvency from within.
But today, external
pressures are just as
severe. Climate change
has intensified natural
PACICC has identified 324 Life insurers that failed around the globe between 2000 and 2024.An catastrophes, increasing
average of 13.0 Life insurers failed each year. both their frequency and
Source: PACICC severity. What were once

The Insurance Times September 2025 19