Nepal Insurance Authority Issues Draft Guidelines on Engineering Insurance, Invites Feedback Within 7 Days
The Nepal Insurance Authority has prepared draft guidelines for engineering insurance to make coverage for construction and infrastructure development projects more systematic and transparent. The regulatory body has requested stakeholders to submit their feedback and suggestions within 7 days.
The Nepal Insurance Authority has prepared a draft of the Engineering Insurance Guidelines aimed at making insurance related to construction projects and infrastructure development more systematic, transparent, and effective. Designed to maintain uniformity in engineering insurance policies and safeguard the interests of policyholders, the regulator has invited stakeholders to submit their feedback and suggestions within 7 days to the Authority's Insurance Policy Branch.
According to the draft, proposers seeking engineering insurance must submit a formal proposal form to a non-life insurer. Insurers will be required to conduct an on-site inspection of the subject matter and compulsorily prepare a Risk Assessment Report for coverage above or below specified limits.
Key Proposed Provisions:
- Insurers must conduct underwriting and issue policies based on the proposal form, risk assessment report, and contract documents.
- Policyholders and insurers must clarify coverage regarding Riots and Terrorism Risk, with insurers charging an additional premium if such coverage is provided.
- Any additions, deletions, or modifications to policy terms and conditions require prior approval from the Nepal Insurance Authority.
- Policy tenure may be one year, shorter, or longer depending on the project's nature, with the total insurance period matching the contract duration plus the Defect Liability Period.