Insurance companies have significantly increased their investments in the stock market, nearly doubling their portfolios within a year.
In the past year alone, they have added nearly Rs 16 billion to the market. According to the Nepal Insurance Authority, by the mid of the current fiscal year 2024/25, insurance companies had invested Rs 33.34 billion in the stock market. This marks a 90.39 percent increase compared to the same period last fiscal year 2023/24. Within a year, their investment rose by Rs 15.827 billion. In the second quarter of the previous fiscal year, insurance companies had invested only Rs 17.509 billion.
Currently, 13 life insurance companies, 12 non-life insurance companies, two reinsurance companies, and three microinsurance companies are actively investing in the stock market.
The rise in investments follows the Authority’s decision to introduce more flexible investment policies. Under existing regulations, insurance companies can invest up to 10 percent of their paid-up capital in the stock market. Additionally, they are permitted to allocate up to 15 percent of their investments in publicly listed companies on the Nepal Stock Exchange (NEPSE). These policy changes have facilitated greater investment expansion.
Life Insurance Companies Surge by 97 Percent
Life insurance companies have been particularly aggressive, increasing their stock market investments by 97.66 percent within a year. In the second quarter of the last fiscal year, life insurers had invested Rs 13.037 billion, which has now surged to Rs 25.77 billion in the corresponding period of this fiscal year.
Himalayan Life holds the largest investment portfolio, having invested Rs 7.33 billion—an increase of 163.37 percent from the previous fiscal year. Nepal Life follows with Rs 3.81 billion, while Citizen Life has seen the most significant rise, increasing its investment by 507.26 percent to Rs 861.3 million.
Other insurers, including Sanima Reliance, National, IME, Reliable Nepal, Sun Nepal, and Suryajyoti Life, have also expanded their investments in the stock market.
Non-Life Insurers Increase Investments by 26 Percent
Non-life insurance companies have raised their stock market investments by 26.32 percent. By the second quarter of the last fiscal year, they had invested Rs 3.475 billion. In the same period this year, their total investment has climbed to Rs 4.39 billion.
During this period, three companies reduced their investments, while nine others increased theirs.
National Insurance leads among non-life insurers with Rs 794.1 million in stock market investments, followed by Neco Insurance with Rs 605.1 million. Other major investors include Sagarmatha Lumbini (Rs 533.7 million), IGEI Prudential (Rs 521 million), and Siddhartha Premier (Rs 505.7 million). NLG, Nepal Insurance, and Sanima GIC have also demonstrated strong investment growth.
Reinsurance Companies Expand by 211 Percent
Reinsurance companies have also expanded their stock market investments significantly, increasing their portfolios by 211.32 percent within six months. Currently, they have invested Rs 3.101 billion.
Himalayan Reinsurance leads with Rs 3.0065 billion in stock market investments, up from Rs 407.2 million at the same time last year. In contrast, Nepal Reinsurance has reduced its investment to Rs 94.7 million, a decline of 83.92 percent compared to the previous year.
Meanwhile, three microinsurance companies have collectively invested Rs 74.9 million. Guardian Micro Life has invested Rs 62.1 million, Liberty MicroLife Rs 10.9 million, and Trust Micro Life Rs 1.8 million in the past six months, according to the Nepal Insurance Authority.
