Business Profile
| Item | Detail |
|---|---|
| Incorporated | 7 November 2014 (succeeded the Nepal Insurance Pool established in 2003) |
| Government ownership | ~44% (Government of Nepal) |
| Other major shareholders | Nepali insurance companies and the general public |
| Quality certification | ISO 9001:2015 |
| Domestic rating | ICRANP-IR AA- (Stable) — ICRA Nepal |
| International rating | None |
Financial Trajectory
Source: NRIC Annual Reports FY 2072/73–FY 2079/80 (on-disk PDFs); FY 2080/81 audited financials are outstanding as of May 2026 (see "Outstanding Items" below); FY 2081/82 figures are from the Q4 unaudited disclosure.
| Metric | FY 72/73 | FY 73/74 | FY 74/75 | FY 75/76 | FY 76/77 | FY 77/78 | FY 78/79 | FY 79/80 | FY 81/82 (Q4) |
|---|---|---|---|---|---|---|---|---|---|
| Paid-up capital (NPR bn) | 5.00 | 5.00 | 5.00 | 5.00 | 10.00 | 10.00 | 11.65 | 12.81 | 13.42 |
| Net worth (NPR bn) | 6.27 | 6.96 | 10.15 | 12.26 | 14.96 | 15.65 | 16.77 | 18.32 | — |
| Net profit (NPR M) | 509 | 669 | 1,008 | 917 | 1,134 | 401 | 1,484 | 1,559 | 1,030 |
| EPS (NPR) | 10.17 | 13.37 | 20.11 | 11.27 | 12.84 | 4.01 | 12.74 | 12.17 | 7.71 |
| DPS (NPR) | — | — | 20.11 | 11.27 | 12.84 | 4.01 | 12.74 | 12.17 | — |
| ROE | 8.2% | 10.1% | 11.8% | 8.2% | 8.3% | 2.6% | 9.2% | 8.9% | — |
| Gross premium (NPR bn) | — | ~6.0 | ~7.5 | ~8.17 | 7.96 | 10.46 | 12.36 | ~14.1 (est.) | — |
| Combined Ratio | 89.8% | 71.4% | 53.2% | 106.6% | 90.9% | 108.0% | 98% | ~105% | — |
| Loss Ratio | 26.6% | 29.1% | 33.1% | 40.7% | 52.6% | 71.6% | ~55% | ~73% | — |
| Solvency margin | 26.19× | 14.14× | 2.07× | 2.65× | 2.47× | 2.82× | 3.26× | 3.65× | — |
| Cession Ratio (outward) | 38.7% | 17.1% | 21.5% | 13.2% | 13.7% | 11.2% | 11.1% | 12.6% | — |
FY 2081/82 Q4 (unaudited): Net profit NPR 1.03B; BVPS approximately NPR 116.27; EPS NPR 7.71. Per-share metrics declining vs. FY 2079/80 EPS of 12.17 due to share-count expansion from bonus and rights issuances.
Underwriting
Loss ratio has trended structurally higher across the eight-year window — from approximately 27% (FY 2072/73) to ~73% (FY 2079/80). Combined ratio first exceeded 100% in FY 2075/76 (106.6%), recovered briefly, and then deteriorated again to 108.0% (FY 2077/78) and ~105% (FY 2079/80). On a stand-alone underwriting basis, NRIC has been operating at a combined ratio above 100% in three of the most recent five disclosed years.
Reported profit is therefore primarily driven by investment income on float rather than underwriting margin.
Investment Portfolio
Yield on investments per the AR series: 7.73% (FY 2077/78) → 9.04% (FY 2078/79) → 9.75% (FY 2079/80). Net retained premium ratio is approximately 87–89%, indicating the company retains most of the risk it underwrites.
Outstanding Items (as of May 2026)
| Item | Status |
|---|---|
| FY 2080/81 audited financials | Filing has been outstanding past the standard filing window. Beemapost reported on 12 November 2025 that NIA was reviewing accounting discrepancies. |
| NIA investigation | The CEO has been called for explanations per public reporting; the review remains active at the time of writing. |
| AML-related share-acquisition review | The Department of Money Laundering Investigation (DMLI) is reviewing transactions related to NRIC shares connected to the broader money-laundering probe involving Mr. Deepak Bhatta and related parties (see Sources for the underlying news coverage). |
| 100% rights issue | Approved. Targeted raise approximately NPR 7.19B to take paid-up capital toward the NPR 20B floor mandated by NIA. |
Valuation (May 2026)
| Metric | Value | Reference |
|---|---|---|
| Market price | ~NPR 898 | Down from a 52-week high of approximately NPR 1,842 |
| Market cap | ~NPR 127.5B | — |
| P/B (BVPS approximately Rs. 96) | ~9.4× | Munich Re ~1.7×; Swiss Re ~1.1×; Korean Re ~0.9× |
| Trailing P/E (annualised EPS Rs. 7.71) | ~116× | — |
| Estimated P/B post-100% rights | ~4.7× | Diluted BVPS would fall to roughly Rs. 193 |
| Dividend yield | Suspended (capital retained for rights issue) | — |
The current P/B is materially above global reinsurance peers. The differential reflects (a) the captive cession framework that has historically protected domestic margins; (b) limited float and trading liquidity in the listed stock; (c) speculative momentum at NEPSE level. The captive cession framework is on a legislated taper (10% in FY 2079/80 → 2% in FY 2083/84 under NIA Reinsurance of Insurers Directive 2080).
The Mandatory Cession Framework
Per NIA's Reinsurance of Insurers Directive 2080 (2023):
| FY | Direct Cession to Domestic Reinsurers |
|---|---|
| 2079/80 | 10% |
| 2080/81 | 8% |
| 2081/82 | 6% |
| 2082/83 | 4% |
| 2083/84 | 2% |
| FY 2084/85+ | Not specified in current directive |
Beyond direct cession: ≥30% of the residual treaty must be placed with domestic reinsurers, currently split equally between NRIC and HRL.
The directly mandated cession decline is approximately 80% over four fiscal years; the residual-treaty floor moderates the impact but does not eliminate it.
Capital Requirement
NIA mandated both reinsurers reach NPR 20B paid-up capital by January 2026 (subsequently extended). NRIC's approved 100% rights issue would raise approximately NPR 7.19B and roughly double the share count.
Key Risks
- Outstanding audited financials. FY 2080/81 audit is overdue; the eventual filing may include restatements.
- Underwriting trajectory. Loss ratio expansion from ~27% to ~73% over seven years is material.
- 100% rights dilution. Per-share metrics will reset materially after issuance.
- Cession-rate taper. Direct mandated rate falling from 10% to 2% by FY 2083/84.
- Government-ownership agency dynamics. Approximately 44% Government of Nepal ownership creates appointment and accountability dynamics distinct from a fully private reinsurer.
- AML-related share-transaction review. DMLI's broader probe encompasses NRIC share transactions (per public reporting on the Bhatta investigation).
- Catastrophe / seismic exposure. Nepal's earthquake exposure is structural.
- Valuation disconnect. P/B of approximately 9.4× is substantially above international reinsurance comparables.
Variables to Monitor
- FY 2080/81 audited financials filing. Watch for any restatements vs. the previously reported figures.
- FY 2081/82 audited financials.
- Loss ratio direction. Year-over-year trend in claims experience.
- Rights issue execution. Subscription level, pricing, and post-issue BVPS.
- NIA framework decision for mandatory cession beyond FY 2084/85.
- DMLI / AML review outcome as it relates to NRIC shareholdings.
Sources
Annual reports
- NRIC Annual Reports FY 2072/73–FY 2079/80 (on-disk PDFs).
- NRIC Q4 FY 2081/82 unaudited disclosures via NEPSE.
Ratings
- ICRA Nepal — NRIC rating reports (May 2023; November 2024).
News and regulatory
- Beemapost — Nepal Reinsurance delays FY 2080/81 report amid accounting discrepancies (12 November 2025).
- Republica — NIA instructs reinsurers to increase paid-up capital to Rs 20B in one year.
- MacroNepal — Nepal Reinsurance approves 100% rights share issuance.
- Investopaper — Reinsurance companies required to meet minimum capital of Rs 20B.
- ShareSansar / NEPSE Trading — NRIC company-page coverage and trading data.
- Kathmandu Post — Inside the Rs 3.73 billion fraud investigation (9 April 2026) — context on the broader money-laundering probe that includes NRIC share transactions.
- Kathmandu Post — Securities Board names top businesspersons in alleged share-rigging (23 April 2026)
References
- NRIC Annual Reports FY 2072/73–2079/80
- Nepal Insurance Authority (NIA) — regulatory directives and reinsurance framework
- NEPSE Market Data
- Nepal Reinsurance Company
Research date: May 10, 2026.