Everest Insurance reopens under IB management

KATHMANDU, DEC 06 - 

Everest Insurance has resumed operations after a break of several months since it was taken over by the Insurance Board (IB). According to the IB team looking after the management of the non-life insurance company, it is back to business as usual. 

IB Deputy Director Kundan Sapkota said they had recently renewed the agreement with General Indian Corporation of India for reinsurance of fire-related claims. We have been selling fire insurance since last week, he said. 

The IB took over Everest Insurance after its management stopped normal business activities for several months. It dissolved the company board and suspended the chief executive officer before sending a three-member team to take over the management. 

The IB team said they had been successful in clearing over 400 claims worth Rs 10.9 million in the last two months after they took over the management. Beside these, we have approved and forwarded a number of Discharge Vouchers to Everest Insurance clients waiting for their final approval in settling the claims, he said. 

Of the total claims pending, more than half were related to automobiles. 

Similarly,

more than 1,500 claims related to medical insurance. The IB said there were a total of 3,400 claims left to be settled when it took over Everest Insurance's management. According to Sapkota, the claims had remained unpaid since fiscal year 2007-08. Santosh Prasai, a chartered accountant and IB team member, the company's previous management had failed to do proper risk analysis in the past. 

With the resumption of full-fledged operations, the IB team has also planned to reopen Everest Insurance's Biratnagar branch office soon. Most likely, we will be resuming operations in Biratnagar by next week.

 Currently, the insurer has been providing its services from its head office in Kathmandu and other branch offices located in Narayanghat, Pokhara, Butwal and Birgunj. Everest Insurance got into trouble after its management paid a claim worth Rs 40 million to Himalayan Snax, the manufacturer of Mayos noodles, without receiving the final report from the surveyor. 

The IB then slapped a monetary fine on the company and stopped the company from issuing fire insurance. In response, the company shut down its entire business. After the company was found to have settled the claim illegally, the IB had initially barred the company from issuing new policies. 

However, it later relaxed the restriction and only barred it from issuing fire insurance following protests from employees. According to Sapkota, they have planned to conduct Everest Insurance's annual general meeting (AGM) by mid-March. 

After forming a new board through the AGM, we will hand over the management to it, he added. Meanwhile, Everest Insurance officials seem to be contented by the growing business. A number of old clients have started buying new insurance policies since the IB restarted the business, said an official. 

Source: The Kathmandu Post