KATHMANDU, Aug 23: The Nepal Insurance Authority (NIA) has directed insurance companies to comply with new anti-money laundering (AML) guidelines for large financial transactions.
Last week, the NIA issued the Directive on Prevention of Financial Investment in Money Laundering, Terrorist Activities, and Production or Expansion of Weapons of Mass Destruction, 2025 requiring insurers to strictly follow the government’s AML regulations. The new regulation aims to prevent money laundering, terrorist financing, and the funding of weapons development, NIA said.
Under the new rules, non-life insurers must report transactions to the government’s goAML System when an insurance policy carries an annual premium of Rs 300,000 or more. Life insurers must do the same if a policy has an annual premium of Rs 100,000 or above.
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Insurers must also record any loan of Rs 10 million or more taken against an insurance policy as collateral and any life insurance claim settlement that exceeds Rs 10 million.
The goAML System, developed by the United Nations Office on Drugs and Crime (UNODC), allows Financial Information Units (FIUs) to automate data collection from financial institutions and reporting entities to fight money laundering and terrorist financing.
The directive instructs insurers to immediately submit suspicious transaction and activity reports to the FIU under Nepal Rastra Bank. It also tells them to monitor large-scale insurance transactions, claim settlements, and premium payments closely.
The NIA has ordered insurers to strengthen measures such as customer identification and suspicious transaction reporting to prevent illegal activities through the insurance sector. It requires full compliance from all stakeholders, including CEOs, employees, intermediaries, and third-party facilitators.
NIA officials said the move supports Nepal’s effort to exit the Financial Action Task Force (FATF) grey list. In line with this goal, Nepal Rastra Bank recently tightened its monitoring of suspicious transactions made through payment service providers.
