Beer Ads On Nepali Television? Why Not?

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We Are More Aware About The Safety Concerns Today Than In The Past

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…

Now Is The Challenge Of Getting Right Reinsurer At A Competitive Price

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No Laughing Matter

The Sweet Rewards of Power

By Madan Lamsal

. . .
read more »

NEPSE

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			'title' => 'Beer Ads On Nepali Television? Why Not?',
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			'summary' => null,
			'content' => '<p>
	<strong style="text-align: justify;">By Abhaya Panday</strong></p>
<p style="text-align: justify;">
	<img alt="Advertising, February 2013" height="190" src="http://www.newbusinessage.com/ckfinder/userfiles/Images/advertising_feb2013.jpg" width="350" /></p>
<p style="text-align: justify;">
	One fine day in 1999 AD, the then His Majesty’s Government decided to ban beer ads on the television. Media reports suggest that it was done under the recommendations of the WHO, the organization which holds immense influence over a poor country like ours. The fact that the same ‘world body’ becomes powerless about the beer ads in countries like the USA is another story altogether. Rumours following the ban also suggested that the decision was made at the behest of a business house which enjoyed monopoly in the country’s beer market. Banning the beer ads on TV would have made it an uphill task for new entrants to increase their market share and thus that ban would have been in the interest of the market leader.&nbsp;</p>
<p style="text-align: justify;">
	But whatever the reasons, apparent or underlying, that is irrelevant. What is important is to question the basis on which the government of the day chose to impose the ban. And why did the party in power, which brands its ideology as the most scientific and revolutionary, choose to continue the legacy of the ‘old regime’? Had the ‘old regime’ conducted a reliable scientific research on the effects of beer ads on its consumption? Let’s forget about a reliable and scientific research for a moment. Did the government conduct any research at all? Nothing suggests that it did. The decision was arbitrary and arbitrariness has become the founding principle of the state in relation to advertising. The latest example of this arbitrariness is the recent decision of one-door policy for government ads.&nbsp;</p>
<p style="text-align: justify;">
	Does the Ministry of Information and Communications (MoIC) possess more expertise in appropriating government ads than the other ministries? Evidence of arbitrariness was seen in the recent past when the Insurance Board decided to curb the spending of insurance companies on their promotional activities, thus negatively affecting the advertising industry. Sometime back, the TV commercial I had made for Digital Cable TV was banned by the MoIC without any clear cut policy on comparative advertising and in the absence of an independent and competent regulatory body on advertising. These are just a few examples which highlight the attitude of the state towards advertising. &nbsp;</p>
<p style="text-align: justify;">
	Let me get back to the ban on beer ads on television. Was it necessary to impose the ban? I don’t think so. Because the assumption that beer advertising results in the increase of overall consumption is unfounded. First, the objective of any advertising exercise is to influence purchase decisions, not to increase the overall consumption. Moreover, in a product category like alcohol that is already widely consumed- in one form or the other- increasing the overall consumption of alcohol is an objective unworthy of pursuit for an advertiser. From the viewer’s perspective, does watching beer ads on TV help the drinker consume more beer than he/she normally does? Or does it entice a non-drinker to have a pint or more? Is advertising the ‘cause’ or the ‘effect’ of alcohol consumption? If the government believes that advertising is the ‘cause’ then perhaps it overestimates the power of advertising. In that case, the government should let the advertising agencies run the nation and by the sheer power of advertising, they shall eradicate all the evils of society. The fact that commercial advertising is mostly the reflection of the society’s values and aspirations and not the cause puts the power of advertising in the proper perspective.&nbsp;</p>
<p style="text-align: justify;">
	Whether beer ads actually increase the overall consumption is an issue that has been raised in the US Parliament more than once. In response, the Federal Trade Commission, The Department of Health and a Senate subcommittee have submitted their reports on different occasions. And their findings suggest a clear absence of correlation between beer advertising and beer consumption. A 21-year long study conducted by Texas University also corroborates the findings. And let’s not forget that we are discussing a country whose per capita alcohol consumption is four times more than that of ours. Some countries in Europe have the figures six times as much, yet beer advertising enjoys considerable freedom in those countries. Of course, the content and placement of beer advertising is regulated and that is what we should be doing in Nepal. Lift the ban on beer advertising on TV and regulate the content and placement. Ironically, the government ignored to impose the ban in the print media, probably under the impression that print advertising is less effective than TV advertising.&nbsp;</p>
<p style="text-align: justify;">
	Is beer drinking good or bad for health? Is moderate drinking medically acceptable or even beneficial? These are medical issues that should be addressed by the medical and health experts. Why do people begin consuming alcohol and, when they do, why do some turn alcoholics? Will we become a better society if we impose a total ban on alcohol? These are different issues altogether. I am neither a medical expert nor a sociologist and nor a psychologist. But as an advertiser, I am led to believe, on the basis of various scientific research conducted in countries where credible scientific &nbsp;research are produced, that advertising of beer on TV does not promote its overall consumption.&nbsp;</p>
<p style="text-align: justify;">
	Advertising, in this view, can only influence the choice of the brand. You may choose to drink beer A instead of beer B, having been influenced by the advertisement of A. But it is most unlikely that you will drink more than what the context allows or, as a non-drinker, you will decide to drink beer A without the psychological need. If the government wants to reduce the consumption of beer or alcohol, then it must address the issues surrounding the psychological and social needs that lead to the consumption of beer or alcoholic products in general. Necessity is not only the mother of invention but also consumption. &nbsp;Kill the enemy, if you can. Don’t kill the messenger.&nbsp;</p>
<p style="text-align: justify;">
	<span style="font-size:11px;">The writer is an advertising professional.</span></p>',
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the founding principle of the state in relation to advertising.',
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			'summary' => null,
			'content' => '<p>
	<strong style="color: rgb(35, 200, 250); font-size: 16px; text-align: right;">‘The pooling mechanism is to stabilize the insurance market’</strong></p>
<p>
	<strong><img align="right" alt="Mahendra Shrestha, Himalayan General Insurance" height="301" src="http://www.newbusinessage.com/ckfinder/userfiles/Images/mahendra_cover_feb2013.jpg" style="margin:0 0 0 10px;" width="250" /></strong></p>
<address style="text-align: right;">
	<strong>Mahendra Shrestha</strong></address>
<address style="text-align: right;">
	<strong>Managing Director</strong></address>
<address style="text-align: right;">
	<strong>Himalayan General Insurance</strong></address>
<p style="text-align: justify;">
	 </p>
<p style="text-align: justify;">
	<strong>What is your company’s stake in the aviation insurance market?</strong></p>
<p style="text-align: justify;">
	Himalayan General has been writing aviation insurance since 1998 and it is a portfolio we continue to be interested in.</p>
<p style="text-align: justify;">
	<strong>It is said that some insurance companies are trying to form a pool to collectively handle the aviation insurance claims. What is the latest progress in this regard?</strong></p>
<p style="text-align: justify;">
	Preliminary discussions have been initiated for the formation of aviation insurance pool. The formation of such a pool will not only allow insurance companies to gain capacity but also make it viable for the re-insurers to continue supporting Nepal’s aviation insurance market.</p>
<p style="text-align: justify;">
	<strong>What future do you see for the aviation insurance business in Nepal?</strong></p>
<p style="text-align: justify;">
	It is a portfolio which is an absolute necessity in Nepal and one that will continue to grow.</p>
<p style="text-align: justify;">
	<strong>Aviation insurance premium in Nepal is said to be one among the highest in the world? Why is it so high? How can we lower it?</strong></p>
<p style="text-align: justify;">
	Aviation insurance premium in Nepal is certainly very high. Some big losses in the last few years have pushed up the premium rates substantially. The continually rising premium rates are, of course, a serious concern because they impact the sustainability of the business. The pooling mechanism is one of the possibilities we are exploring in order to stabilize the market. Eventually, if the total premium paid is more than the total amount claimed in losses, we hope the premium will start to come down.</p>
<p style="text-align: justify;">
	What are the key challenges and issues facing the aviation insurance industry in Nepal and what needs to be done to address these challenges?</p>
<p style="text-align: justify;">
	Rising premium rates and shrinking market capacity are two major challenges the aviation insurance industry is currently facing. The Aviation Insurance Summit was one way to address these challenges and find a common direction for improvement and growth.</p>
<p style="text-align: justify;">
	<strong>The country’s first-ever aviation insurance summit was organized in the capital recently. How helpful was this summit?</strong></p>
<p style="text-align: justify;">
	The Summit brought local stakeholders, including operators, regulatory bodies, insurance companies and banks as well as key players in the regional and global aviation insurance industry (including underwriters and re-insurance brokers) under one roof. It gave the Nepali stakeholders a global perspective on our current situation as well as access to the expertise of visiting delegates, all of whom have extensive experience in this sector, including in other countries with contexts similar to Nepal.</p>
<p style="text-align: justify;">
	All the delegates who attended the Summit said that they had found it to be a helpful introduction to the Nepal aviation insurance market, adding that it will help them take better decisions for supporting it.</p>',
			'published' => true,
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			'description' => 'The continually rising premium rate is a serious concern because they impact the sustainability of the business. The pooling mechanism is one of the possibilities we are exploring in order to stabilize the market.',
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			'id' => '871',
			'article_category_id' => '40',
			'title' => 'We Are More Aware About  The Safety Concerns Today Than In The Past',
			'sub_title' => '',
			'summary' => null,
			'content' => '<p>
	<strong style="color: rgb(35, 200, 250); font-size: 16px; text-align: right;">‘We are more aware about the safety concerns today than in the past’</strong></p>
<p>
	<img align="right" alt="Rameshwor Thapa, Airlines Operators Association of Nepal " height="314" src="http://www.newbusinessage.com/ckfinder/userfiles/Images/rameshwor_cover_feb2013.jpg" style="margin:0 0 0 10px;" width="250" /></p>
<address style="text-align: right;">
	<br />
	<strong>Rameshwor Thapa</strong></address>
<address style="text-align: right;">
	<strong>President&nbsp;</strong></address>
<address style="text-align: right;">
	<strong>Airlines Operators Association of Nepal (AOAN)</strong></address>
<p>
	<strong><br />
	</strong></p>
<p style="text-align: justify;">
	<strong>What is the size of the aviation insurance market in Nepal?</strong></p>
<p style="text-align: justify;">
	When talking about the insurance size, the Nepali aviation insurance business is small in global comparison. However, it has an addressable size in the context of the South Asian countries. That means the aviation insurance market in Nepal is neither big nor small but of medium size in terms of money as well as the number of insurers involved in this business. We now pay USD 8 to 9 million in premium to international companies annually.&nbsp;</p>
<p style="text-align: justify;">
	<strong>Why is the aviation insurance premium so high in Nepal? How can we lower it?</strong></p>
<p style="text-align: justify;">
	The re-occurrence of air crashes have contributed to the increment of aviation insurance premium. The open sky aviation policy has helped the mushrooming of airliners in Nepal while the infrastructure remains almost the same. And there may be many issues concerning safety issues. The dramatic increase in premium is also because of the climate and weather. Importantly, trunk route operators have fewer problems in comparison to the STOL (short takeoff and landing) route operators mainly because of the high hills and high altitude. In STOL, mainly in helicopters, there are many instances of accidents beyond what could be conconsidered as normal. &nbsp;</p>
<p style="text-align: justify;">
	Now there are more airports and other facilities which could be rated higher in safety. We are organizing many safety seminars and programmes to lower the premiums with the safety much assured. There have been programmes enhancing the safety measures and we are very much confident that we would be able to enhance safety measures. We are more aware about the safety concerns today than in the past. The audit reports by ICAO and other organizations have diversified it further and made it clear also. Aircraft and passenger safety should be the airliners’ main concern. If we maintain all this - for enhanced safety in the aviation sector - definitely the premium will come down.&nbsp;</p>
<p style="text-align: justify;">
	<strong>There have been more than 50 major accidents in the past 10 years. Why is the frequency of aerial accidents so high in Nepal?&nbsp;</strong></p>
<p style="text-align: justify;">
	It is very sad and bitter fact. The increasing premium in aviation insurance is making it difficult for the airline companies. These days we are trying to improve the security in the aviation sector and are not expecting such accidents again. We are working to reduce such accidents by organizing different seminars and programmes to enhance safety in the aviation sector. Through these safety seminars, we are being able to make the stakeholders aware about air safety. There, we make the pilots aware about focusing on safety while the stakeholders update themselves with different issues and activities in the aviation sector. All the people involved in this sector should understand that not compromising any safety measures but maintaining them will help mitigate the risks. Visual Flight Regulation (VFR) should not be allowed to go through the clouds. &nbsp;If we follow all these safety measures, definitely the risks have to go down. Civil Aviation Authority of Nepal (CAAN) should monitor these flights and instruct accordingly.&nbsp;</p>
<p style="text-align: justify;">
	<strong>The annual claims payout in the aviation insurance has been constantly rising. This is bound to further increase the already significantly high aviation insurance premium. How are we going to tackle this problem?</strong></p>
<p style="text-align: justify;">
	We are concerned about this problem. Basically, if we are able to enhance safety measures, it would help to lower the premium paid out to reinsurance companies. Most of the re-insurers are quite convinced that we would be able to maintain safety properly. End of the Maoist war has also spread positive message to the reinsurers. In the past, we had to pay US$ 60 million premium in third party liability though we owned small aircraft. After knowing the problem, Nepal government addressed this. And now we have to pay some 10 million dollars for the same. The thing is, once we fix the safety problem, the premium will come down.&nbsp;</p>
<p style="text-align: justify;">
	<strong>There are various types of aviation insurance policies in the world. Are all of them available in Nepal?</strong></p>
<p style="text-align: justify;">
	There are not various types of insurance policies in the aviation insurance. The available insurances are air-craft’s insurance, passenger’s insurance, cargo insurance, crew-members insurance- including others. There are insurance policies with same periphery and nature and are normally practiced in other countries as well. Now there are different types of reinsurance market but the problem is they take our situation as an alarming one. I think the situation is not that alarming. Some of the reinsurance companies really want to work and support the Nepali aviation sector which includes Indian as well as western reinsurance companies. A new aviation group in Malaysia is also interested in this business. Moreover the re-insurer companies are not of various types; they are of a singular nature and type.&nbsp;</p>
<p style="text-align: justify;">
	<strong>The country’s first-ever aviation insurance summit was organized in the capital recently. What’s your impression of the summit?&nbsp;</strong></p>
<p style="text-align: justify;">
	It was definitely helpful to us. I think the reinsurance companies that were finding threats in our sky are convinced that the premium which we are paying is not justifiable. We hope that in the coming days they won’t increase the premiums and won’t take our sky as an alarming one for aviation insurance. They got a chance to understand our aviation environment and we had a chance to put the reality in front of them. We were able to prove that there is neither any violence in the country nor any threat in the aviation sector. We were able to prove that we are quite committed to maintaining safety and that we are continuously working on it. We have learnt from past accidents and we are committed to avoiding such accidents.&nbsp;</p>',
			'published' => true,
			'created' => '2013-03-16',
			'modified' => '2013-03-16',
			'keywords' => '',
			'description' => 'Most of the re-insurers are quite convinced that we would be able to maintain safety properly. End of the Maoist war has also spread positive message to the re-insurers.',
			'sortorder' => '755',
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	(int) 3 => array(
		'Article' => array(
			'id' => '870',
			'article_category_id' => '40',
			'title' => 'Now Is The Challenge Of Getting Right Reinsurer At A Competitive Price',
			'sub_title' => '',
			'summary' => null,
			'content' => '<p>
	<strong style="color: rgb(35, 200, 250); font-size: 16px; text-align: right;">‘When the losses start decreasing, the premium will come down’</strong></p>
<p style="text-align: justify;">
	<strong><img align="right" alt="Kewal Krishna Shrestha, Everest Insurance" height="316" src="http://www.newbusinessage.com/ckfinder/userfiles/Images/kewal_cover_feb2013.jpg" style="margin: 0 0 0 10px;" width="250" /></strong></p>
<address style="text-align: right;">
	<strong>Kewal Krishna Shrestha&nbsp;</strong></address>
<address style="text-align: right;">
	<strong>President, Nepal Insurers Association &amp;</strong></address>
<address style="text-align: right;">
	<strong>CEO, Everest Insurance</strong></address>
<p style="text-align: justify;">
	<strong><br />
	</strong></p>
<p style="text-align: justify;">
	<strong>What is the size of the aviation insurance market in Nepal?</strong></p>
<p style="text-align: justify;">
	The market size is around Rs 420- 500 million in terms of the premium we collect from our clients.&nbsp;</p>
<p style="text-align: justify;">
	<strong>What about your company’s stake in the market?</strong></p>
<p style="text-align: justify;">
	We own around 25-30 per cent share in Nepal’s aviation insurance market.&nbsp;</p>
<p style="text-align: justify;">
	<strong>It is said that some insurance companies are trying to form a pool to collectively handle the claims on aviation insurance. Are you aware of the latest progress in this regard?</strong></p>
<p style="text-align: justify;">
	I don’t think the pool is what we need to improve the aviation insurance business. Now we are competing to get the lowest rate from reliable companies (reinsurers) but if such a pool is formed, there would be monopoly in the insurance market and there would be no competition. Insurance companies could syndicate the aviation insurance business and the situation could worsen further. The premium will be at a high rate and the airliners will raise the ticket price which in turn will make air travelling difficult. It seems beneficial to all of us but if we view it minutely it is only a means of syndicating that could affect the whole country economically. &nbsp;</p>
<p style="text-align: justify;">
	However, if such pool is sure to be formed we could form this pool in two ways. One, we can calculate certain risks in the aviation industry and other, we can focus on the risks involved in the hull, baggage etc. However creating such a pool needs lots of vision.&nbsp;</p>
<p style="text-align: justify;">
	Beema Samiti recently organized an interaction programme on the possibilities of merger between &nbsp;insurance companies. This interaction was a good initiation in the insurance business but I think both the government and Beema Samiti should be well prepared on it. It needs lots of homework and researches whether to form a pool or to merge the insurance companies.&nbsp;</p>
<p style="text-align: justify;">
	<strong>What future do you see for the aviation insurance business in Nepal?</strong></p>
<p style="text-align: justify;">
	The prospects of aviation business in Nepal depend on the growth of the airliners. The more airlines are there, the better for the aviation insurance business. The theory of demand and supply is applied in the aviation business also. Many airlines are not functioning well and some of them have registered but have not started their operation yet. If new airliners start operating it would benefit both the airliners and the aviation industry. &nbsp;Development of airports and runways in a sustainable way can also sustain airliners. And the development of airliners ultimately grows the aviation insurance business. Since there is a lot of prospects in the tourism sector, I see bright future of aviation insurance business.&nbsp;</p>
<p style="text-align: justify;">
	<strong>Aviation insurance premium in Nepal is said to be one among the highest in the world? Why is it so high?</strong></p>
<p style="text-align: justify;">
	No, I disagree with this. We used to pay 8-9 per cent premium some 10 years ago and we were able to reduce that as low as 2 per cent later. Now again the reinsurance companies are charging the same old rate or even higher. It is mainly because of the risk factors in the aviation industry of Nepal and I don’t think it is unjustifiable. The terrain, safety measures in the aviation industry in Nepal and lack of maintaining safety standards by all the stakeholders involved in the aviation industry are some of the reasons behind the increment of premium. We lack the standard safety measures in spite of ICAO advice.&nbsp;</p>
<p style="text-align: justify;">
	<strong>What do you expect from the Beema Samiti or the government for that matter to facilitate the aviation insurance business in the country? &nbsp;</strong></p>
<p style="text-align: justify;">
	The government can enforce the safety standards. It can properly manage the runways, ground handling, and certify efficiency of the people and the equipment used in the aircraft or for the aircraft maintenance. If you see how the baggage in airports is handled, you will find how improperly things are done. The baggage is loaded in tractors and the insurer has to pay if there is a damage. Furthermore, the international airport in Nepal is very crowded. I think the TIA should now be shifted to some convenient place.&nbsp;</p>
<p style="text-align: justify;">
	<strong>What are the key challenges and issues facing the aviation insurance industry in Nepal?</strong></p>
<p style="text-align: justify;">
	Now is the challenge of getting the right reinsurer at a competitive price. The aviation business is anyway running though the reinsurers are charging up to 12 per cent. But what if they charge 20-25 per cent? I don’t think aviation in Nepal could bear such high premium rates. Moreover, the environment could be such that even the high premium might not draw reinsurers into confidence. Because of the high risk involved in this business, the reinsurers could add more clauses which could affect the overall aviation business in Nepal. And then it will be hard to find reliable reinsurers and we will have to reinsure with whichever party we find. When the claim increases, the premium market becomes hard and reinsurers hesitate to do business. And aviation insurance is driven by reinsurers. Unless the scenario of this seller-driven market changes, we won’t have any other alternative.&nbsp;</p>
<p style="text-align: justify;">
	<strong>What needs to be done to address these challenges?</strong></p>
<p style="text-align: justify;">
	CAAN has to be strong. All the stakeholders of the aviation industry should maintain the safety standards prescribed by ICAO in terms of physical amenities, ground handling, aircraft maintenance, tracing of the aircraft personnel etc. Maintaining the safety standard is the foremost requirement. Everybody in the aviation industry should strictly follow the policies and run under rules and regulations of the government. &nbsp;</p>
<p style="text-align: justify;">
	<strong>The annual claims payout in the aviation section has been constantly rising. This is bound to further increase the already significantly high aviation insurance premium. How are we going to tackle this problem?</strong></p>
<p style="text-align: justify;">
	This is not a problem; it’s an outcome which is natural. When claims payout in the aviation sector starts increasing, increment in the premium is normal internationally. &nbsp;And when the claims start rising, the party is affected and slowly it affects other airliners. When the risk is found the reinsurer loads the premium and that is considered normal in the insurance business.&nbsp;</p>
<p style="text-align: justify;">
	When safety measures are properly followed the risk has to go down. For this, all the stakeholders in the aviation industry should come together and contribute. &nbsp;Evaluation of our work and adopting things that make this business ideal as well as searching ways of perfection in the aviation business is a must.&nbsp;</p>',
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			'description' => 'Now we are competing to get the lowest rate from reliable companies (reinsurers) but if such a pool is formed, there would be monopoly of the insurance companies and there would be no competition.',
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			'id' => '869',
			'article_category_id' => '40',
			'title' => 'When The Losses Start Decreasing, The Premium Will Come Down',
			'sub_title' => '',
			'summary' => null,
			'content' => '<p>
	<strong style="color: rgb(35, 200, 250); font-size: 16px; text-align: right;">‘When the losses start decreasing, the premium will come down’</strong></p>
<p>
	<img align="right" alt="Pronab Sen, National Insurance Company Ltd" height="317" src="http://www.newbusinessage.com/ckfinder/userfiles/Images/pronab_cover_feb2013.jpg" style="margin: 0 0 0 10px;" width="250" /></p>
<address style="text-align: right;">
	<strong>Dr Pronab Sen&nbsp;</strong></address>
<address style="text-align: right;">
	<strong>Chief Executive Officer,&nbsp;</strong></address>
<address style="text-align: right;">
	<strong>Nepal</strong><strong>National Insurance Company Ltd</strong></address>
<p>
	 </p>
<p style="text-align: justify;">
	<strong>What is your company’s stake in the aviation insurance portfolio?</strong></p>
<p style="text-align: justify;">
	We are moving very selectively in the aviation insurance in Nepal. Previously, Guna Air was 100 per cent with us and now Simrik Air has taken it over. There are some airliners which are having reinsurance support from our corporate office in India- like Buddha Air. We have around five percent market share in the aviation portfolio. Agni Air is co-insured with Shikhar Insurance – 60 percent with them and 40 per cent with us. Another airline in Pokhara has insured 49 per cent with us and 51 per cent with Shikhar. We are now negotiating with Simrik because Guna was with us. &nbsp;</p>
<p style="text-align: justify;">
	We are the direct branch of a reinsurance company in India governed by the Indian Government. We have high retention capacity. We reinsure the portion to other reinsurance companies that is beyond our financial strengths. This is a worldwide phenomenon in insurance business. It depends on portfolios and varies from risk to risk. Sometimes, we retain 20 per cent and sometimes 90- depending on the risks.</p>
<p style="text-align: justify;">
	<strong>Is it true that the insurance companies in Nepal have not been able to make profits from aviation insurance? Why?</strong></p>
<p style="text-align: justify;">
	Yes it is true. And the reason is there are a number of airliners which are very small in size. It may be also because of the weather and terrain of Nepal. Small airliners and aviation companies do not afford expertise and there are few airliners where I have seen the full expertise – this is the biggest challenges for the Nepali aviation sector. Many of the aircraft are also very old. &nbsp;</p>
<p style="text-align: justify;">
	Some of the insurance companies have retention capacity of 0.4 per cent and rest is reinsured. These companies are getting only the reinsurance commission. &nbsp;</p>
<p style="text-align: justify;">
	<strong>Some insurance companies are trying to form a pool to collectively handle the aviation insurance claims. What is your view on this proposal?</strong></p>
<p style="text-align: justify;">
	It is still in the pipeline. Nothing concrete has come out so far. But if such a pool is formed, it will help both the aviation insurers as well as the airliners. After the formation of the pool, they don’t have to run around different countries trying to find out the lowest rate. Once the pool is formed, they know that they have to approach only one office which will organize everything. And the office will be the consortium of a number of insurance companies.&nbsp;</p>
<p style="text-align: justify;">
	<strong>What future do you see for aviation insurance business in Nepal?</strong></p>
<p style="text-align: justify;">
	The future is good because there is a tremendous growth in the tourism sector in Nepal. The tourism sector has a tremendous scope and the more this sector grows, the more the aviation sector expands. More people prefer to travel by air in Nepal considering the time taken in travelling by roads. By air you reach Pokhara in 20-25 minutes.But if you take a bus, it takes 5- 6 hours. And the growth of airliners has paved the road for growth of the aviation insurance companies.&nbsp;</p>
<p style="text-align: justify;">
	<strong>Almost whatever the insurance companies earn from the aviation segment goes to the reinsurance companies abroad. Some are even said to be making losses in the aviation segment. It is said that the companies know that they are not going to make profits from the aviation segment. But they do aviation insurance just to show high insurance premium collection. What do you say?</strong></p>
<p style="text-align: justify;">
	It is not like that. The premium is based on the past losses. If you see the statistics, almost every year there is an air crash and some years, there are around two air crashes in Nepal. And the rate of premium is governed by the reinsurance market. Because of the air accidents, some of the reinsurers were hesitant to do business in Nepal. The aviation summit last month also put forth lots of similar issues in the aviation industry- the dos and the don’ts. Beyond that, the aviation business has a very bright future.&nbsp;</p>
<p style="text-align: justify;">
	<strong>Aviation insurance premium in Nepal is said to be one among the highest in the world? Why is it so high?</strong></p>
<p style="text-align: justify;">
	Yes. As I already said, insurance premiums are based on the past losses. Because of the crashes, the premium has been rising. The recent crashes of Sita Air and Agni Air were a serious concern for the reinsurers.&nbsp;</p>
<p style="text-align: justify;">
	<strong>Are those high premium rates justifiable?&nbsp;</strong></p>
<p style="text-align: justify;">
	The loss is calculated based on the coverage offered by the insurance companies. Suppose there is a loss. You pay some percent of the loss. You pay for the hull losses and the machinery parts or you pay for the passenger liabilities. Passenger liability losses are much higher than the hull losses depending on the kind of passengers. The liability losses are much higher if the passengers are from the US or Canada, and lower if they are from the SAARC countries. The liability losses vary from people to people because of theirs living standard. While finalizing the rates, reinsurers study these things.&nbsp;</p>
<p style="text-align: justify;">
	Airliners not only fly Nepali people or SAARC people but also other foreigners. For example, most of the people in the mountain flights are from European countries. Furthermore, airliners have different premiums depending on their types, aircraft, and management facilities they have.&nbsp;</p>
<p style="text-align: justify;">
	<strong>How can we lower the high insurance premium?</strong></p>
<p style="text-align: justify;">
	It’s a million dollar question. It has to be high, otherwise it won’t be viable. We are not totally dependent on our own companies. We may not have the capacity, so we need to approach other markets for reinsurance. When the losses start decreasing, the premiums will simultaneously come down. For example in India, the fire premium rate was very high in the past. Many studies were conducted. And when they calculated the total premium over a period of time, and how much profit they generated- then the premium started coming down. Likewise, though the premium is high at the moment, it will definitely go down every year if the risk is reduced. In the present scenario, you don’t have any choice. Until the reinsurer accepts the business, how can you reinsure?</p>
<p style="text-align: justify;">
	<strong>The country’s first-ever aviation insurance summit was organized in the capital recently. How helpful was this summit?</strong></p>
<p style="text-align: justify;">
	I think it was helpful. We got to know the perspectives of different reinsurers present there. It was the first of its kind event in Nepal and was helpful for everyone involved in the aviation industry.&nbsp;</p>',
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			'description' => 'We have high retention capacity. We re-insure the portion to other reinsurance companies that is beyond our financial strengths.',
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		'Article' => array(
			'id' => '868',
			'article_category_id' => '40',
			'title' => 'Unhealthy Competition Among The Insurance Companies Should Be Stopped',
			'sub_title' => '',
			'summary' => null,
			'content' => '<p>
	<span style="color:#23c8fa;"><span style="font-size: 16px;"><strong>‘Unhealthy competition among the insurance companies should be stopped’</strong></span></span></p>
<p>
	<strong><img align="right" alt="Prem Bahadur Maharjan, Rastriya Beema Sansthan" height="307" src="http://www.newbusinessage.com/ckfinder/userfiles/Images/prem_cover_story_feb2013.jpg" style="margin:0 0 0 10px;" width="250" /></strong></p>
<address style="text-align: right;">
	<strong>Prem Bahadur Maharjan&nbsp;</strong></address>
<address style="text-align: right;">
	<strong>Chairman</strong></address>
<address style="text-align: right;">
	<strong>Rastriya Beema Sansthan</strong></address>
<div>
	 </div>
<p style="text-align: justify;">
	<strong>What is your company’s stake in the aviation insurance market?</strong></p>
<p style="text-align: justify;">
	The amount of insurance is calculated in foreign currency. We own around USD 2 million business which constitutes 30 to 40 per cent of the total aviation insurance business. We are the only insurance company insuring big aircraft including jet planes. We have insured the Jet planes of the national flag carrier, Nepal Airlines, and BB Airways lately. We have succeeded in acquiring the largest proportion of insurance share in the market because national airlines is insured with us. &nbsp;&nbsp;</p>
<p style="text-align: justify;">
	<strong>Is it true that the insurance companies have not been able to make profits from aviation insurance? Why?</strong></p>
<p style="text-align: justify;">
	I don’t agree with this. &nbsp;In our case, we feel that there is some harsh competition including in the premium rates. And particularly in the private airlines sector, we have witnessed a number of air crashes. That might have contributed to the loss in the overall aviation insurance business but it is not the case of Beema Sansthan. We have not gone through such loss. Nor &nbsp;have our clients faced such air crashes.&nbsp;</p>
<p style="text-align: justify;">
	<strong>Some insurance companies are trying to form a pool to collectively handle the claims on aviation insurance. When could we see such a pool?</strong></p>
<p style="text-align: justify;">
	I have also heard about it. I guess the practice of collectively handling the aviation insurance claims is yet to materialize. It would be good if such a pool is formed. It will help prevent unhealthy competition.&nbsp;</p>
<p style="text-align: justify;">
	<strong>What future do you see for aviation insurance business in Nepal?</strong></p>
<p style="text-align: justify;">
	I see a lot of potential for this business. &nbsp;The aviation market has grown in Nepal over the years and with it, the aviation insurance business, too, has grown. The other big reason is that Nepal is promoting tourism by organizing many events. This has increased the number of air passengers to Nepal and thus helped the aviation insurance in the country.&nbsp;</p>
<p style="text-align: justify;">
	<strong>Almost whatever the insurance companies earn from the aviation segment goes to the reinsurance companies abroad. Some are even said to be making losses in the aviation segment. It is said that the companies know that they are not going to make profits from the aviation segment. But they do aviation insurance just to show high insurance premium collection. What do you say?</strong></p>
<p style="text-align: justify;">
	In a way, it is true. Since we don’t have a strong financial institution that can cover the aviation insurance, we depend on foreign reinsurance companies. Though the percentage of commission from premium collection that we collect seems minimal, we are able to sustain the operation. Though the commission might be less in comparison to the bigger amount of insurance premium; we have other indirect benefits as well. It is because we have to reinsure &nbsp;with very reliable reinsurance companies recognized internationally. There are very few reliable reinsurance companies. Beema Sansthan has found a re-insurer based in the United Kingdom.&nbsp;</p>
<p style="text-align: justify;">
	<strong>What do you expect from the Beema Samiti or the government for that matter to facilitate the aviation insurance business in the country? &nbsp;</strong></p>
<p style="text-align: justify;">
	There is unhealthy competition among the insurance companies at present. They tend to take the aviation insurance business at low rates ignoring the risk factors. The situation is such that some companies might collapse if something bad happens to the airlines they have insured. Moreover, I have heard that some insurance companies are even unable to pay out the claims. Beema Samiti, being the regulatory body, can set some standards to avoid such kind of unhealthy competition. Beema Sansthan is a government-owned institution. So, it does not need to jump into this unhealthy competition. Though aviation insurance is growing, almost all the premium collected here goes abroad. We get only a fraction of it as commissions. I think this is the time that Beema Samiti should form a government-owned re-insurance company in Nepal. It will help us to stop or decrease the amount of money going outside the country.&nbsp;</p>
<p style="text-align: justify;">
	<strong>What are the key challenges and issues facing the aviation insurance industry in Nepal?</strong></p>
<p style="text-align: justify;">
	As I already mentioned, the first challenge is unhealthy competition among some insurance companies. The risk factor is also growing and it is making premiums costlier. We have witnessed many air crashes in a quite short period of time. It is not only about insurance, it is also about the safety of the people.&nbsp;</p>
<p style="text-align: justify;">
	<strong>What needs to be done to address these challenges?</strong></p>
<p style="text-align: justify;">
	There has to be a strict monitoring mechanism for air traffic discipline. People involved in the aviation business should be given safety education. Pilots should also be alerted not to take any sort of risks.&nbsp;</p>
<p style="text-align: justify;">
	Moreover, unhealthy competition among the insurance companies should be stopped. And it could be managed since there are very limited insurance companies in the aviation sector. Furthermore, the government should try to establish reinsurance companies here in Nepal itself.</p>
<p style="text-align: justify;">
	<strong>The country’s first-ever aviation insurance summit was organized in the capital recently. How did you find this summit?</strong></p>
<p style="text-align: justify;">
	From educational point of view, the summit was quite fruitful to the people involved in the aviation insurance sector. It was successful in raising the issues related to the risk factors in the aviation insurance and about the premiums that are in practice. Such summits are helpful in making people aware about the things happening in the aviation insurance market. I expect such events to continue.&nbsp;</p>',
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			'description' => 'The first challenge is unhealthy competition among some insurance companies.The risk factor is also growing and it is making premiums costlier.',
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			'id' => '867',
			'article_category_id' => '40',
			'title' => 'Airclaims Is A Major Resource For Nepali Civil Aviation',
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			'summary' => null,
			'content' => '<address>
	<strong style="text-align: right;"><font color="#23c8fa" size="3"><span style="font-style: normal;">‘Airclaims is a major resource for Nepali civil aviation’</span></font></strong></address>
<address>
	<strong style="text-align: right;"><font color="#23c8fa" size="3"><span style="font-style: normal;"><br />
	</span></font></strong></address>
<address>
	<strong>Douglas G Cavannagh</strong></address>
<address>
	<strong>Risk and Safety Manager</strong></address>
<address>
	<strong>Airclaims&nbsp;</strong><strong>(A UK-based leading reinsurance company)</strong></address>
<p style="text-align: justify;">
	<strong><br />
	</strong></p>
<p style="text-align: justify;">
	<strong>How long has your company been involved in the insurance business in Nepal?&nbsp;</strong></p>
<p style="text-align: justify;">
	Airclaims is the leading provider of claims, risk management and asset management services to the global aviation industry. Founded in 1964 Airclaims has been handling aviation insurance claims in Nepal since the late 1960s. Airclaims currently handles in excess of 2500 assignments each year though a global network of 20 offices. Airclaims is the leading provider of such expertise worldwide.&nbsp;</p>
<p style="text-align: justify;">
	In terms of Airclaims risk and safety consulting services this service offering was initially utilised by aviation insurance underwriters to assess the risk profile of different operators. The initiation of these studies was often a consequence of a serious accident or a deteriorating loss record on the part of an operator.&nbsp;</p>
<p style="text-align: justify;">
	As our capability grew these services were expanded to include risk and safety assessments of maintenance, repair and overhaul facilities, helicopter operators, ground handling companies and airports. During the past 20 years many of these services have also been utilised by petroleum and mining companies who use our expertise to assess the risk of different contractors that they use. Airclaims is now one of the leading providers of operator risk assessments in this sector. Our experience is often in demand from investors who require a bespoke due diligence study to assist them to better understand the risks associated with a potential acquisition and to provide valuations and condition surveys of aircraft to potential purchasers or those who wish to update the value of their aviation assets. We also undertake a considerable amount of work for airlines and operators who require a completely impartial assessment of their operation and a worldwide perspective to help them improve their own internal safety capability. This ranges from the initial assessment and needs analysis, to project management, training, coaching and final assessment.&nbsp;</p>
<p style="text-align: justify;">
	In today’s challenging asset management environment, the demand is for a business partner that not only has a strong reputation and broad capability but also the consistency of approach.&nbsp;</p>
<p style="text-align: justify;">
	Our integration of what are typically considered separate functions, such as project management, airworthiness oversight, powerplant services and risk management are all combined to form ten core modules, providing a unique capability&nbsp;</p>
<p style="text-align: justify;">
	<strong>How do you differentiate yourself from other companies?</strong></p>
<p style="text-align: justify;">
	We differentiate ourselves by:&nbsp;</p>
<ul>
	<li style="text-align: justify;">
		Drawing on ‘real world’ experience gained from our involvement in the aftermath of many of the largest aviation accidents and losses during the past 50 years.&nbsp;</li>
	<li style="text-align: justify;">
		Being able to recommend bespoke solutions to mitigate risk based on our work with all the different parties involved in aviation, not just airlines and operators.&nbsp;</li>
	<li style="text-align: justify;">
		Using our international experience gained from working with many different nationalities and cultures, to train and coach organisations on how to achieve the same objectives using alternative methods.&nbsp;</li>
	<li style="text-align: justify;">
		Using our exposure to accident sites and our knowledge of emergency response services to tailor procedures to the reality of what actually happens during these events.&nbsp;</li>
</ul>
<p style="text-align: justify;">
	<strong>The size of your business in Nepal at present?&nbsp;</strong></p>
<p style="text-align: justify;">
	That really depends on how often there is an accident. Unfortunately for some that has been a little too often. If there was to be a reduction in the number of accidents as a result of Airclaims providing Risk Management rather than Claims Management Services then that would be fine with us too. We are currently the preferred aviation claims handling company for the national airline and a number of domestic operators in Nepal and also most International carriers who operate services to Kathmandu. Our presence in Nepal over many decades has enable Airclaims to build up much valued relationships.&nbsp;</p>
<p style="text-align: justify;">
	<strong>Why is the insurance premium in aviation so high in Nepal?&nbsp;</strong></p>
<p style="text-align: justify;">
	There are a number of factors that affect the rate at which the insurance premium is calculated in any market. Some of those factors are loss record, operating environment and the type and value of the aircraft being insured.&nbsp;</p>
<p style="text-align: justify;">
	Nepal is undoubtedly a challenging operating environment for operators and crews in terms of terrain, weather and infrastructure and these factors do mean that along with a loss record that reflects these challenges, insurance costs will be higher. However, with improvements in infrastructure, training and operations, it is quite possible to address many of these factors and in doing so ensure that the cost of insurance is maintained at a reasonable level.&nbsp;</p>
<p style="text-align: justify;">
	There is also the factor of insurance market capacity something which cannot be directly influenced in Nepal. Worldwide, it could be said that there is a good deal of capacity i.e. insurers who want to underwrite aviation risks. Capacity and competition help keep the price down although, Nepal is seen as a higher risk region because of the factors already mentioned above.&nbsp;</p>
<p style="text-align: justify;">
	We know that all parties involved in aviation in Nepal are keen to support the improvements that are needed to ensure risk is reduced and Airclaims are ready to play its part in the provision of not just loss management services but also risk management services.&nbsp;</p>
<p style="text-align: justify;">
	<strong>What are the challenges faced by the aviation insurance business in Nepal?&nbsp;</strong></p>
<p style="text-align: justify;">
	The challengers faced by the aviation insurance business in Nepal are the challenges that face the aviation operators as well. The biggest challenge is to reduce operational risk. Despite the significant challenges that are faced, Nepal is clearly serious in its desire to reduce risk and consequently improve safety. It can be done.&nbsp;</p>
<p style="text-align: justify;">
	The main challenges facing aviation in Nepal are:&nbsp;</p>
<ul>
	<li style="text-align: justify;">
		Infrastructure improvement. There needs to be a significant investment in better basic airport facilities (i.e. runways, navigation aids, etc.)&nbsp;</li>
	<li style="text-align: justify;">
		Weather reporting. There is a requirement for a significant number of automatic weather stations to report the weather being experienced in real time, via satellite link, in the more remote parts of the country.&nbsp;</li>
	<li style="text-align: justify;">
		Better operational control being exercised by the operators. It needs to become a complete team effort especially when difficult decisions are needed associated with dispatch of aircraft in the difficult operational environment that exists.&nbsp;This will become even more important over the next decade or so as the average age and experience levels of pilots are reduced.&nbsp;</li>
	<li style="text-align: justify;">
		More and better training to help reduce the effect of the loss of highly experienced pilots over the next ten years.&nbsp;</li>
</ul>
<p style="text-align: justify;">
	<strong>What can Nepal do to overcome these challenges?&nbsp;</strong></p>
<p style="text-align: justify;">
	The system of regulation that has been in place for the past 50 plus years may have reached its maximum effectiveness. Regulation by requiring compliance with rules and regulations has probably got as good as it will get globally. The adoption of a more proactive and predictive Safety Management System (SMS) is needed by the operators and aviation authorities in Nepal. Having an effective way of safety oversight such as through adoption of a Safety Management System (SMS) has been proved to improve safety and risk management culture. Such a system can be used to support airline owners, airline managers, pilots &amp; engineers and all who are involved in aviation; this includes the regulators who must have a key role in supporting new ways of looking at risk and safety management and oversight.&nbsp;</p>
<p style="text-align: justify;">
	<strong>The annual claims payout in the aviation section has been constantly rising. This is bound to further increase the already significantly high aviation insurance premium. How are we going to tackle this problem?&nbsp;</strong></p>
<p style="text-align: justify;">
	The current global picture is interesting with record low levels of claims for successive years. Unfortunately this trend has not been seen in Nepal. Tackling the problem will require leadership on the part of the regulating authorities towards resetting the scene for risk and safety management such as through improvement in the operational management operators. The regulating authorities can and need to play a leading role in improving oversight and ensuring that all operators are able to take advantage of an open and even handed approach to improvement of infrastructure and operational standards. Operators investing in good safety systems and management should be supported and those that are failing to do this need to be provided with proper advice and if necessary some forms of sanction up to and including withdrawal of AOC.&nbsp;</p>
<p style="text-align: justify;">
	New approaches and thinking will bring positive benefits. We can’t just keep doing business as we have always done and expect things to get better on their own. Change is inevitable in all businesses not least aviation and the benefits to Nepal can be significant in terms of social and economic reward.&nbsp;</p>
<p style="text-align: justify;">
	<strong>What prospects do you see for aviation insurance business in Nepal in the future?&nbsp;</strong></p>
<p style="text-align: justify;">
	The prospects for aviation insurance business in Nepal are bright. There is a capable and knowledgeable local market which has good relationships with the global insurance community. The present level of risk is too high but there are enough insurers willing to support the market, albeit currently at a higher cost than in some other places. What is perceived as the current high cost of insurance can and should be reduced for operators who demonstrate a good safety culture and record, adopt a Safety Management Programme that is working well and can prove that it is making a difference.&nbsp;</p>
<p style="text-align: justify;">
	<strong>Is there anything else that you would like to say?&nbsp;</strong></p>
<p style="text-align: justify;">
	As a leading provider of Claims Handling and Risk and Asset Management Services and with our long association with Nepal aviation, Airclaims can help make a safer environment for all stakeholders in aviation in Nepal, but it has a cost. Therefore, we are ready to work with the leaders of aviation in Nepal to support Nepal in the development of its aviation capability and ambitions with safety as the focus of any plan. Once it happens all of Nepalese society will reap the benefits.&nbsp;</p>',
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		'Article' => array(
			'id' => '866',
			'article_category_id' => '40',
			'title' => 'Sky Is The Limit For Aviation Insurance In Nepal',
			'sub_title' => '',
			'summary' => null,
			'content' => '<p style="text-align: justify;">
	<img align="right" alt="Prakash Panday, Shikhar Insurance Company Ltd" height="276" src="http://www.newbusinessage.com/ckfinder/userfiles/Images/prakash_panday_cover_feb2013.jpg" style="margin: 0px 0px 0px 10px;" width="235" /></p>
<address style="text-align: right;">
	<strong style="color: rgb(35, 200, 250); font-size: 16px; font-style: normal;">‘Sky is the limit for aviation insurance in Nepal’</strong></address>
<address style="text-align: right;">
	 </address>
<address style="text-align: right;">
	<strong>Dip Prakash Panday</strong></address>
<address style="text-align: right;">
	<strong>CEO</strong></address>
<address style="text-align: right;">
	<strong>Shikhar Insurance Company Ltd</strong></address>
<p>
	 </p>
<p style="text-align: justify;">
	<strong>What is the size of the aviation insurance market in Nepal?</strong></p>
<p style="text-align: justify;">
	The total size of the aviation insurance market of the domestic private sector in Nepal is around USD 8.5 -9 million.&nbsp;</p>
<p style="text-align: justify;">
	<strong>What about your company’s stake in the market?</strong></p>
<p style="text-align: justify;">
	We have around 70-75% market share.</p>
<p style="text-align: justify;">
	<strong>Is it true that the insurance companies have not been able to make profits from the aviation insurance? Why?</strong></p>
<p style="text-align: justify;">
	Aviation Insurance in Nepal has been a loss making portfolio for all the insurers involved. &nbsp;This has been because of the losses in the last couple of years. Nepal is being taken as a high risk zone for aviation insurance.&nbsp;</p>
<p style="text-align: justify;">
	<strong>It is said that some insurance companies are trying to form a pool to collectively handle the aviation insurance claims. What is the latest progress in this regard?</strong></p>
<p style="text-align: justify;">
	It is a very good concept. Reinsurance companies support about 99.5 per cent insurance and only 0.5% is handled by the local insurance companies. The main idea behind forming this pool is to take the advantage of the volume and also to get quality reinsurers so that losses get paid in a timely manner and also to have standardization in all the policies. &nbsp;This can also help in some investment in safety features.&nbsp;</p>
<p style="text-align: justify;">
	<strong>How is this pool going to help the insurance companies, if and when it is formed?</strong></p>
<p style="text-align: justify;">
	It is still in the planning process. Insurance companies and operators have to come together with full support from the regulators before such a pool can be formed. &nbsp;</p>
<p style="text-align: justify;">
	<strong>What future do you see for aviation insurance business in Nepal?</strong></p>
<p style="text-align: justify;">
	Sky is the limit for aviation insurance in Nepal. The only thing is that safety factors have to be improved. Nepal’s aviation sector is classified as the highest risk zone for reinsurers. We want to see Nepal as a safe destination. When a pool of insurers is going to own the overall aviation insurance, more responsibility shall be felt. Risk management is very important.&nbsp;</p>
<p style="text-align: justify;">
	<strong>Almost whatever the insurance companies earn from the aviation segment goes to the reinsurance companies abroad. Some are even said to be making losses in the aviation segment. It is said that the companies know that they are not going to make profits from the aviation segment. But they do aviation insurance just to show high insurance premium collection is. What do you say?</strong></p>
<p style="text-align: justify;">
	We are not sending money, we are transferring risk. The reason that the companies are still in profit is because the money is flowing in from the reinsurers abroad. Since they agreed to take the risk, they bear the losses as well. But after eight consecutive years of losses, they are getting scared. Some of the reinsurers have already withdrawn from the Nepali aviation market.</p>
<p style="text-align: justify;">
	<strong>How can we lower the high insurance premium?</strong></p>
<p style="text-align: justify;">
	It will take time. It is important to win the confidence of the reinsurers and prove that Nepal’s aviation sector is a safe zone for investment. This can be done only by reducing the losses. Fear is a very dangerous thing. Our terrains are difficult, which has sent a wrong perception. Similarly, loss is also a perception and this can be changed. All we need is 2 to 3 years of good loss ratio.&nbsp;</p>
<p style="text-align: justify;">
	<strong>What do you expect from the Beema Samiti or the government for that matter to facilitate the aviation insurance business in the country? &nbsp;</strong></p>
<p style="text-align: justify;">
	It would be great if the Beema Samiti would help in the process of making an Aviation Pool. Active participation and support is required from them and the Civil Aviation Authority of Nepal (CAAN), especially on the safety side. This should not be only on papers but also in practice.&nbsp;</p>
<p style="text-align: justify;">
	<strong>What are the key challenges and issues facing the aviation insurance industry in Nepal?</strong></p>
<p style="text-align: justify;">
	CAAN has to take the lead role. CAAN and the private airline operators should be more alert. There should be an improvement in monitoring flight data, safety infrastructure etc. For example, many airports in Nepal are not black-topped. When the weather is bad, flights should be aborted and airports should be closed. Individual behavior should be monitored by the operators. We also need to invest in training and skill development of the people involved in the aviation business.&nbsp;</p>
<p style="text-align: justify;">
	<strong>The annual claims payout in the aviation section has been constantly rising. This is bound to further increase the already significantly high aviation insurance premium. How are we going to tackle this problem?</strong></p>
<p style="text-align: justify;">
	There should be a considerable investment in safety measures. I feel that the only way out now is to produce good results for the reinsurers. Losses do happen but the frequency of losses in our country is high. If we go jointly, I feel that this will be a good beginning and we can produce significant results. &nbsp;</p>
<p style="text-align: justify;">
	<strong>There are various types of aviation insurance policies in the world. Are all of them available in Nepal?</strong></p>
<p style="text-align: justify;">
	Three basic types of aviation products are available in Nepal. These are basically for Hull, Liability including Passengers and Crew Personnel Accident and Hull War. Hull insurance covers the insurance of aircraft. Till last year, Combined Single Limit Liability insurance required was USD 60 million per aircraft which has now been revised. Hull War insurance is used in case of war, hijacking etc. &nbsp;</p>
<p style="text-align: justify;">
	<strong>The country’s first-ever aviation insurance summit was organized in the capital recently. How helpful was this summit?</strong></p>
<p style="text-align: justify;">
	Reinsurers came to the market and studied it. Their perception has changed. We took them to see our infrastructures including a mountain flight and had discussions on the current issues of the aviation market. We are trying our best to boost the reinsurers’ confidence. We feel that the summit has helped to bring some positive change in their risk perception of our country.</p>
<div style="text-align: justify;">
	 </div>',
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			'description' => 'The reason that the companies are still in profit is because the money is inflowing from the reinsurers abroad. Since they agreed to take the risk, they bear the losses as well.',
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	(int) 8 => array(
		'Article' => array(
			'id' => '865',
			'article_category_id' => '39',
			'title' => 'NICL : Three Decades Of Insurance',
			'sub_title' => '',
			'summary' => null,
			'content' => '<p>
	<img alt="National Insurance Company Limited (NICL)" height="60" src="http://www.newbusinessage.com/ckfinder/userfiles/Images/corporate_focus_feb2013.jpg" style="text-align: justify;" width="210" /></p>
<p style="text-align: justify;">
	National Insurance Company Limited (NICL) is a Government of India Undertaking and is operating in Nepal since 1973. NICL completed 106 years on 6th December 2012 and is into the 107th year of operation. Prior to nationalisation in India in 1972, it was operating as a private company. In 1972, at the time of nationalisation of Non Life Insurance Sector in India, there were 106 companies operating in India and later on, 22 Foreign and 11 Indian private companies were merged to form National Insurance Company Limited.</p>
<p style="text-align: justify;">
	National Insurance Company Limited (NICL) had hardly any competitions at the time of establishment, three decades back in Nepal. Now the company is facing a cut throat competition from 17 non life insurance companies in the Nepali market.&nbsp;</p>
<p style="text-align: justify;">
	The stiff competition does not deter the company from having its strong foothold in the market. NICL believes and enjoys working on a competitive environment. “We welcome competition in the insurance field. We strongly feel that competition is must to ensure prompt services to clients and it is good for the customers as they can look forward to better services,” said Dr Pronab Sen, Chief Executive Officer (CEO) of the company’s Nepal operations. However, the competition is mostly in the service front since most of the portfolios are tariff products and the rates are fixed by the regulators, so the competition is almost none on the premium rate front.</p>
<p style="text-align: justify;">
	<strong>Market Potentials</strong></p>
<p style="text-align: justify;">
	Though the competition has heightened much, insurance business has not been able to penetrate deep enough into the insurance market. Sen said that the penetration level is just 0.55 per cent. Therefore, the company sees huge untapped market potentials available.&nbsp;</p>
<p style="text-align: justify;">
	“I strongly feel that the non life insurance business can be increased many folds in Nepal as the awareness level is very low and we need to create insurance awareness among masses,” said Sen. Even though the Nepali insurance market has seen many players for the last three decades, still the awareness level lies low. The insurance market has not developed much during this time span. Sen feels that there is a need to recruit agents, who can propagate the message of insurance among the masses and make people understand the need of insurance. He believes that this could be the means to create indirect employment.</p>
<p style="text-align: justify;">
	Amid the competitive environment, the NICL has come up by leaps and bounds. Dr Sen said, “We have grown many folds in terms of business, manpower and networking.”</p>
<p style="text-align: justify;">
	<span style="font-size:14px;"><strong><img align="right" alt="Pronab Sen, National Insurance Company Limited" height="184" src="http://www.newbusinessage.com/ckfinder/userfiles/Images/corporate_focus_feb2013_pronab.jpg" style="margin:0 0 0 10px;" width="150" /><br />
	</strong></span></p>
<p style="text-align: justify;">
	<span style="font-size:14px;"><strong>‘We strongly feel that competition is must to ensure prompt services to clients and it is good for the customers as they can look forward to better services.’</strong></span></p>
<p>
	<span _fck_bookmark="1" style="display: none;">&nbsp;</span></p>
<address>
	Dr Pronab Sen</address>
<address>
	CEO, Nepal Operations</address>
<address>
	National Insurance Company Ltd</address>
<p>
	<span _fck_bookmark="1" style="display: none;">&nbsp;</span></p>
<p style="text-align: justify;">
	<strong>Market Presence</strong></p>
<p style="text-align: justify;">
	Currently the NICL has six branch offices - three in Kathmandu and one each in Birganj, Biratnagar and Nepalganj. &nbsp;Sen said that the company has Beema &nbsp;Sewa &nbsp;Kendras &nbsp;in Hetauda and Janakpur. “Apart from this, we also have representatives based in Dhangadi, Dharan, Narayangarh, Simara and Birtamod with the controlling office in Kathmandu,” he explained.&nbsp;</p>
<p style="text-align: justify;">
	NICL has planned to expand its network to cities like Pokhara and Bhairahawa and upgrade the Beema Sewa Kendras to Sub Branch. Sen said that with a service oriented motive the NICL has some ambitious plans on a customer centric ground. Similarly the company is planning to organise insurance awareness programmes for the clients along with publicity and brand image.</p>
<p style="text-align: justify;">
	<strong>Products and Services</strong></p>
<p style="text-align: justify;">
	Being a non life insurance company, NICL offers wide range of products ranging from Motor, Fire, Personal Line policies like Sweet Home, Personal Accident, Health Insurance, Liability, and Aviation among others. According to Sen, the company has cattle and livestock and crop policy in its pipeline as the Insurance Board has already issued directives for the same.&nbsp;</p>
<p style="text-align: justify;">
	To ensure prompt services, the NLIC has centralised its claims processing and started a Centralized Claims Processing Hub in Kathmandu, with the sole idea of reducing the Turn Around Time (TAT) in claim processing, according to Sen. “On experimental basis, we have also started paying claims through Electronic Clearing Service (ECS) and in the initial stage, we are restricting it to the corporate clients and based on the results, we will initiate this system for all claims,” he revealed. Employee’s salary, surveyors payment and agency commission payment is being done through ECS as an experiment.</p>
<p style="text-align: justify;">
	<strong>Human Resources</strong></p>
<p style="text-align: justify;">
	The company has 76 employees as of now. &nbsp;The company believes that its employees are its most valuable assets. NICL gives value to the team work and the spirit of working in unity. Sen shared, “We are continuously trying to upgrade the soft skills of our team members with the motto “Grow Profitably” i.e. ensure top line as well as bottom line growth and feel proud to be an NICian.”</p>
<p style="text-align: justify;">
	He said that the company is continuously involved in developing the soft skills of its employees so that they can perform better and make the team more sensitive to customer’s needs and deliver results in time.&nbsp;</p>
<p style="text-align: justify;">
	Though having its parent company in India, NICL has just two expats from India and rest of its manpower is from Nepal itself. “Our recruitments are restricted to Nepali citizens only,” said Sen.</p>
<p style="text-align: justify;">
	However, one of the biggest challenges the company is facing at the moment is getting skilled manpower in insurance domain. To resolve this issue the NICL organises in-house training to its people.</p>
<p style="text-align: justify;">
	<strong><img align="left" alt="National Insurance Company Limited" height="314" src="http://www.newbusinessage.com/ckfinder/userfiles/Images/corporate_focus_feb2013_financial_highlights.jpg" style="margin:0 10px 0 0;" width="282" />Management Mantra</strong></p>
<p style="text-align: justify;">
	The NICL believes in maintaining the transparency and good corporate governance to its best. Sen explained, “Our management’s commitment is to maintain transparent working and remain committed to compliance of tariff and guidelines of the regulator and law of land.” The company has been able to maintain a cordial relationship with the regulator – Insurance Board of Nepal - in its operation history and strictly abide by all the rules and regulations issued by the regulator.&nbsp;</p>
<p style="text-align: justify;">
	Managing claims is probably one of the challenging jobs at an insurance company. To handle the sensitive issue, the company is concentrating on improving claims services and reducing TAT for claims settlement. Sen believes, being a part of the service sector, the overall business depends on the quality of the services offered. “Now we have a process in place, to depute surveyors immediately on receipt of the claim irrespective of the fact whether it is a holiday or a working day,” he said, “To complete the formalities to enable us to settle client’s claims at the earliest possible.”</p>
<p style="text-align: justify;">
	<strong>CSR Activities</strong></p>
<p style="text-align: justify;">
	Beginning from the 107th Foundation day on 6th December 2012, the NICL has initiated the CSR activities in Nepal. As a part of the CSR activities, the company distributed 107 blankets and rechargeable torches to poor elderly people and orphan children. NICL also organised a health check up camp and blood donation camp on 6th January 2013, which was attended by the NICL employees, clients and surveyors apart from general public. The company plans to plant 107 saplings shortly along with numerous other CSR plans in the pipeline.</p>
<p style="text-align: justify;">
	Similarly, the company is also the Gold Sponsor of Walkathon organised by Standard Chartered Bank every year for helping restoration of eyesight of visually impaired and to help the HIV infected persons in Nepal.</p>
<div>
	<img alt="National Insurance Company Limited" height="563" src="http://www.newbusinessage.com/ckfinder/userfiles/Images/corporate_focus_feb2013_swot.jpg" width="277" /></div>
<p>
	 </p>',
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			'description' => 'Though the competition has heightened much, insurance business has not been able to penetrate deep enough into the insurance market.',
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	(int) 9 => array(
		'Article' => array(
			'id' => '864',
			'article_category_id' => '38',
			'title' => 'Three “R”s For  Startup Businesses',
			'sub_title' => '',
			'summary' => null,
			'content' => '<p style="text-align: justify;">
	<span style="text-align: justify;">Businesses are hard to predict. There is a saying “God laughs at those who plan the future”. This applies both to life and to businesses, especially the ones that are just starting. Pukar Shah, a returnee from the UK, has recently started a business of planting Aloe Vera in his own ancestral land that was mostly going to waste due to shortage of trusted labourers. He believes that Nepal can improve its status only by making large investments in the agriculture sector. While the rest of the world has reached far away from the time of doing agriculture, 80 per cent of Nepal‘s population still relies on nature for a living. &nbsp;This is not only a culture but also a big natural advantage to Nepal. Nepal can grow everything that grows in between 8000 m to 60 m above sea level. While the richest country of the world, the US, with its organization USAID is investing in Nepal’s agriculture with projects like FTF (Feed the Future) and Health for Life (H4L), it is an opportunity to respond. Plus, according to Pukar, it is a risk-free business because he already has a line of buyers who want to buy his produce.&nbsp;</span></p>
<p style="text-align: justify;">
	Harvard Business School Professor Noam Wasserman has outlined &nbsp;three Rs for the people wanting to start up their own business. In his article, Wasserman lists them as “Three Pitfalls Startup Founders must avoid”. These are the relationship decisions, roles decisions, and rewards decisions. According to Prof Wasserman, while starting a new business, there’s a strong temptation to make decisions for the short term. But you need to anticipate the long-term challenges. It is very critical to get at least three things right. They are:&nbsp;</p>
<p style="text-align: justify;">
	<strong>Co-founders:</strong> The natural inclination is to co-find with family or friends. But these relationships can be fraught. Plus you’re more likely to have similar perspectives. Look for partners who bring complementary skills and assets.&nbsp;</p>
<p style="text-align: justify;">
	<strong>Roles:</strong> Most founders want a C-level title. After all, they were there from the start. But choose roles that reflect the actual work each founder will do, not the fancy title he wants to show off.&nbsp;</p>
<p style="text-align: justify;">
	<strong>Rewards: </strong>One of the biggest questions for start-ups is how to split the equity ownership. A handshake on 50/50 will not do because almost all new companies will have a major change in strategy or founder involvement. Negotiate an arrangement that can change when the circumstances do.</p>
<div style="padding:10px; background:#f4f3e6;">
	<p>
		<strong><span style="font-size:14px;">Naming the Company</span></strong></p>
	<p style="text-align: justify;">
		Together with the ideas, management and operation planning, NAME for the Startup Organization also makes a considerable difference. What’s in a name? Well judging from the long list of businesses that a simple Google search can yield when you search “naming your company”, there are plenty. While deciding on a name, don’t take the decision lightly. Not only is your company’s name a critical part of your overall identity, but it will also be used on any of your marketing products, PR, blogs, websites and publications. Given below are five naming strategies that have been successful globally.&nbsp;</p>
	<p>
		<strong>Real Words</strong></p>
	<p style="text-align: justify;">
		When you consider, Apple, Yahoo, Indeed and Amazon, they mean something but often they have no immediate relation to their business.&nbsp;</p>
	<p style="text-align: justify;">
		<strong>Misspelled Words</strong></p>
	<p style="text-align: justify;">
		No, this isn’t an insult of your intelligence. We know that you know how to spell, but using phonetics rather than grammar may give you that cool edge you need. Consider some of these well known examples; Tumblr (Tumbler), Del.icio.us (Delicious), Digg (Dig) and Flickr (Flicker).&nbsp;</p>
	<p style="text-align: justify;">
		<strong>Two Syllable, Compound Words</strong></p>
	<p style="text-align: justify;">
		There are plenty of new companies moving in this direction. Among some of the most popular, there’s BirchBox, SkillShare, CrowdTilt and JackThreads. This could possibly have something to do with the success of FaceBook.&nbsp;</p>
	<p style="text-align: justify;">
		<strong>Initials and Acronyms</strong></p>
	<p style="text-align: justify;">
		Think about going old school, such as IBM (International Business Machines), AOL (America Online) and TBS (Turner Broadcast System). You’re not alone. Reportedly, Rupert Murdoch is considering changing the name of The Wall Street Journal to simply “WSJ”.&nbsp;</p>
	<p style="text-align: justify;">
		<strong>Made-Up Words</strong></p>
	<p style="text-align: justify;">
		Skype, Hulu and Zynga are all made up words. But if you’re successful, you most likely won’t find yourself in any trademark grudge matches in the future.&nbsp;</p>
	<p style="text-align: right;">
		<span style="font-size:11px;">(Source: compiled from various sources)</span></p>
</div>
<p>
	 </p>
<p style="text-align: justify;">
	Pukar, in his startup business, has successfully implemented all these strategies. He happens to follow this idea from his uncle who has been involved in this sector for over 20 years now. Pukar is confident that his uncle’s expertise and his knowledge in proper management of the company will help him succeed in the long run in this sector. Pukar is not obsessed with the CEO title. He has chosen the role of managing the production process and looking after the financials while his uncle handles the marketing department. He had set up an initial agreement of 50 per cent &nbsp;investment and 50 per cent &nbsp;returns with his uncle. But according to him, he currently owns only 35 per cent of the return and the overall organization has four shareholders from two in just a matter of a year. He believes that one cannot have a fixed agreement in business; instead, one needs to go with the flow.</p>
<p style="text-align: justify;">
	Also, it is very crucial to understand the cash flow before starting a business. More than a third of new businesses fail in the first three years and it’s rarely because of a bad business concept; it’s almost always the result of running out of cash. As well as having working capital to cover early stage losses, it’s imperative that you collect your invoices on the due date. If you don’t, you are providing working capital to your customers and unless you are running a bank, you can’t afford to do this. According to Pukar, if cash is the king for a successful business, it’s the emperor for a start-up. &nbsp;</p>
<p style="text-align: justify;">
	<img align="left" alt="Management February 2013" height="259" src="http://www.newbusinessage.com/ckfinder/userfiles/Images/management_feb2013(4).jpg" style="margin:0 10px 0 0;" width="250" />For Pukar, there was no problem of having insufficient resources and capital for giving a shape to his idea, but most of us who want to start a business do not have the resources and capital. Not only in Nepal but also in most of the developed countries in the world, there are angel investors. Angels typically invest their own funds, unlike venture capitalists, who manage the pooled money of others in a professionally-managed fund. Angel investments bear extremely high risk and are usually subject to dilution from future investment rounds. As such, they require a very high return on investment. A large percentage of angel investments are lost completely when early stage companies fail. Therefore,, professional angel investors seek investments that have the potential to return at least 10 or more times their original investment within five years through a defined exit strategy such as plans for an initial public offering or an acquisition. The Silicon Valley of the United States of America, also known as the home to many of the world’s largest technology corporations as well as thousands of small startups, was funded by the Angel investors from the beginning. A Harvard report by William R Kerr, Josh Lerner and Antoinette Scholar provides evidence that angel-funded startup companies have historically been less likely to fail than companies that rely on other forms of initial financing.</p>',
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			'description' => 'While starting a new business, there’s a strong temptation to make decisions for the short term. But you need to anticipate the long-term challenges.More than a third of new businesses fail in the first three years and it’s rarely because of a bad business concept; it’s almost always the result of running out of cash.',
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			'id' => '863',
			'article_category_id' => '38',
			'title' => 'Is Shakespeare Relevant In Today’s Commercial World?',
			'sub_title' => '',
			'summary' => null,
			'content' => '<p>
	<strong style="text-align: justify;">By Sujit Mundul</strong></p>
<p style="text-align: justify;">
	There have been lots of debates and discussions on the relevance of Shakespeare’s heroes as leaders in the modern commercial world. On this widely debated subject, a great deal of work had happened in the Oxford University under the leadership of Richard Oliver.</p>
<p style="text-align: justify;">
	I have had the good fortune to interact with Richard many times on the issues of leadership, seeking his guidance. It is increasingly common to hear nowadays that we are facing a crisis of leadership. The ways in which organizations are moving forward can no longer be comprehended through the same models, language and logical analysis that have served leaders in the past.</p>
<p style="text-align: justify;">
	I could strongly agree with Richard that the time has come when businesses actually need what the arts have to offer in order to survive. We can draw a good deal of similarity between the commercial world and the arts, in that both the streams, apparently poles apart, need creativity, imagination, flexibility, adaptability, effective communication and visionary tendencies for survival as well as &nbsp;domination in the respective fields.</p>
<p style="text-align: justify;">
	Stories have been used to inspire and instruct us human beings since we learnt to speak.</p>
<p style="text-align: justify;">
	Let us take a look at Shakespeare’s stories. Henry V is the story from which we can glean the most about the nature of inspiration. From the first line that calls to our imagination with its plea for “a muse of fire”, to the last scene where Henry, as a Victorian leader, struggles to turn a battlefield into a garden, the plot, to my reckoning, reflects invaluable insights into leadership.</p>
<p style="text-align: justify;">
	Henry V unites a group of disparate people (his nobles) around a common goal (in this instance, reclaiming the territory of France) and manages to overcome all difficulties in his path to achieve a near miraculous victory against the odds (i.e. winning the Battle of Agincourt).</p>
<p style="text-align: justify;">
	So, readers are encouraged to see the King as an inspired leader, the nation as an organization, the nobles as the senior management team, and France as a big project. &nbsp;I am sure that once we start thinking along these lines, we can very well find the relevance of Shakespeare’s characters in today’s changing world. Shakespeare survives gracefully through the changing fads of every generation because he touches so consistently on the truth of human experience.</p>
<p style="text-align: justify;">
	Henry V takes over as King after the sudden demise of his father, the late King.But people can’t believe that Henry, who has the reputation of a spoiled brat, would allow Lord Chief Justice (a hard critic of Henry) to continue in the same position as also to become his mentor. In addition Henry promises to call Parliament. His journey begins.</p>
<p style="text-align: justify;">
	In Act 1 we see Henry meets with his nobles to gather support for achieving his mission to reclaim the territory of France. He gets their consent. Henry has sent a message to the King of France asking if he will give up his throne. The French ambassador arrives with an answer; a trunk which Henry assumes will be full of jewels in an attempt to buy him off. Instead, it is full of tennis balls sent by the French Prince with an accompanying message that Henry better stick to the trivial pursuits he is capable of winning like tennis. Henry gives the ambassador a right –royal telling off and sends him out. Finally, he makes a firm commitment to pursue his mission to France.</p>
<div>
	<img alt="Management February 2013" height="234" src="http://www.newbusinessage.com/ckfinder/userfiles/Images/management_feb2013(2).jpg" width="580" /></div>
<div>
	<div style="text-align: justify;">
		In commercial life, when we start our first project as a leader, we need to seek sound advice and believe in the “right” to go ahead. This “right” is granted internally and externally. Internally we can use a “line of service” to draw strength from. But we need certain amount of political intelligence to win the external right, to prepare our nobles (senior management) to take a risk and follow us into new territories. And we will have to make a demonstrable and visible commitment to pursue the project. If people think we are not totally behind this, the project may fail. Henry did follow all these steps.</div>
	<div style="text-align: justify;">
		 </div>
	<div style="text-align: justify;">
		In Act 2 Henry gathers and allocates his available resources and identifies and deals with those who oppose the mission (and the traitors) before it has even started.</div>
	<div style="text-align: justify;">
		 </div>
	<div style="text-align: justify;">
		In all major projects, leaders should be able to identify the forces ranged for and against them. Many a times, a good leader has to be a good actor. He may need to hide certain knowledge from certain people at certain times. He may need to disguise intentions, particularly while attempting to identify those who disagreed with the agreed mission and who may oppose its desired outcome. It is important to identify them correctly and deal with them appropriately for ensuring success of the project.</div>
	<div style="text-align: justify;">
		 </div>
	<div style="text-align: justify;">
		In Act 3, Henry starts with a reasonable plan: arrive in August with 10,000 troops, take the first foothold in a week and march on to Paris by Christmas. He lands at the coastal town of Harfleur as planned but three months later, he is still there having lost 2000 men. He makes a rousing speech to his exhausted troops. An effective leader will have to speak passionately and imaginatively to motivate them through the blocks. The next attack seems to make a difference, for the Governor of Harfleur asks for a peace party. Henry speaks and warns that if the town is not surrendered now; he will be unable to control his troop’s anger. Then when they do succeed, the town will be destroyed and people killed. The Governor surrenders the town. Henry insists that all the inhabitants be treated mercifully. He changes strategy and decides to withdraw to Calais (an English territory at that time) where his troops can rest over winter.&nbsp;</div>
	<div style="text-align: justify;">
		 </div>
	<div style="text-align: justify;">
		Throughout the play, Henry demonstrates the wonderful leadership quality of painting pictures of the future. Here he uses it to paint such a negative view of the future that the Governor gives in rather than risk that picture becoming reality. He does not press on to his initial goal regardless; he revises his strategy on the ground. Nor does he admit failure and simply retreat to England. He finds a third way; a strategic withdrawal.</div>
	<div style="text-align: justify;">
		 </div>
	<div style="text-align: justify;">
		The French army is chasing Henry’s exhausted 8000 walking men with 40,000 fresh mounted troops. Inevitably they catch up and surround the English on the field of Agincourt. The French Herald is sent in to offer Henry a simple choice; give in now (and pay a huge fine but Henry and all his troops leave), or fight tomorrow and die. Henry says he does not seek a battle at the moment; he wishes to march to Calais, but if challenged he will fight. The French prepare for battle.</div>
	<div style="text-align: justify;">
		<strong><span style="font-size:16px;"><br />
		</span></strong></div>
	<div style="text-align: justify;">
		<strong><span style="font-size:16px;">Managers have to solve problems. Leaders have to solve dilemmas, complex issues with no happy solutions. When leaders meet the real test, they will require to call on all their skills to hold a line that will give their people enough confidence to carry on</span></strong>. Act 4 shows Henry going through the long dark night before the battle, facing up to his fears and duties before being able to inspire his troops to an apparently miraculous victory against the odds.</div>
	<div style="text-align: justify;">
		 </div>
	<div style="text-align: justify;">
		Henry cannot really want to be out talking to his troops at 3 o’clock in the night. But he does it because it is required of him. He exercises visible leadership which is seen by others thus bolstering their confidence.</div>
	<div style="text-align: justify;">
		 </div>
	<div style="text-align: justify;">
		Leaders need to allow themselves to enter “the dark night of the soul” and face their own innermost fears, doubts and uncertainties, especially in a crisis, and particularly before they make decisions that affect the lives of others. If they don’t, they may make wrong decisions for the wrong reasons. There is a point in most meaningful projects when the leaders are forced to ask themselves: “Is this the right thing to do? And are we the right persons to do it?” In these times they will have to manage their own fears and the fears of others simultaneously but differently.</div>
	<div style="text-align: justify;">
		 </div>
	<div style="text-align: justify;">
		Henry is courageous enough to listen to what the troops really think. But if he listens carefully to what they are thinking, he may just be able to inspire them later. However, he also feels the weight of responsibility that they put on him. He needs to unload this or he may make his decision on what others want rather than what he thinks is right. When Henry arrives back at his tent, he overhears the nobles wishing for more troops. He speaks to them from the heart, telling them why he personally believes they are doing the right thing. He says they are enough to win honorably or die trying. He says those that do not wish to fight can leave. But any that chose to fight and survive will remember this day for the rest of their lives. They go off to start the battle.</div>
	<div style="text-align: justify;">
		 </div>
	<div style="text-align: justify;">
		The whole process of surviving the “Dark Night” has served to strip away layers to reveal Henry’s center, his core values - what he is doing all this for. Mind you, it is from this core that he speaks to inspire others.</div>
	<div style="text-align: justify;">
		The battle is going well for the English. They deal with the first wave of French attack and capture many prisoners. Another attack is sounded. Henry orders his men to kill the prisoners. Meanwhile the French have raided the luggage tents and killed all the boys who were guarding them. The Herald enters and tells Henry the day is his. He thanks God and forbids everyone to boast of the victory. They set off for Calais.</div>
	<div style="text-align: justify;">
		 </div>
	<div style="text-align: justify;">
		Most leaders wish they could get through their career without having to take any tough decision. Very few get their wish. There is usually a situation where we are forced to compromise the values on which we prided ourselves when we started our journey to leadership. It is the ability to take these hard decisions and live with the consequences that separates “the men from the boys” amongst the leaders.</div>
	<div style="text-align: justify;">
		 </div>
	<div style="text-align: justify;">
		In Act 5 Henry is encouraged to make peace and turn the battlefield into a garden. He attempts to court Princess Katherine (daughter of the French King) but realizes he has much to learn about building relationships before the political necessity becomes a heartfelt reality.</div>
	<div style="text-align: justify;">
		 </div>
	<div style="text-align: justify;">
		Katherine agrees to the marriage but Henry can tell she does not yet love him. He understands that he has to change his approach and learn a new way of life.</div>
	<div style="text-align: justify;">
		 </div>
	<div style="text-align: justify;">
		Many leaders have got where they are because of their ability to fight and win. Sometimes though, this is not enough. &nbsp;We may have to nurture the new territory we have achieved rather than look for the next target.</div>
	<div style="text-align: justify;">
		 </div>
	<div style="text-align: justify;">
		To my mind, Shakespeare’s relevance in the modern complex world of commerce holds good adequately. Nevertheless, I leave it to the readers to decide on this enunciation, as they feel apposite.</div>
	<div>
		 </div>
	<div>
		<strong>Mundul is a Director with Standard Chartered Bank Nepal Ltd.</strong></div>
</div>',
			'published' => true,
			'created' => '2013-03-15',
			'modified' => '2013-03-15',
			'keywords' => '',
			'description' => 'Shakespeare survives gracefully through the changing fads 
of every generation because he touches so consistently on 
the truth of human experience.',
			'sortorder' => '747',
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	(int) 11 => array(
		'Article' => array(
			'id' => '862',
			'article_category_id' => '37',
			'title' => 'Global Economy Outlook  For 2013: Figures & Beyond!',
			'sub_title' => '',
			'summary' => null,
			'content' => '<p style="text-align: justify;">
	<strong>By Sandip Nepal</strong></p>
<p style="text-align: justify;">
	The year 2012 remained gloomy for the entire seven billion plus world population in terms of economic growth and prosperity. With world economic leaders like the USA, Eurozone and China not acquiring the ‘expected status’ for the year, i.e. 2012, amidst spiking issues like unemployment, inflation and debt crisis regimes, prospects for 2013 do not look encouraging at this point of time.</p>
<p style="text-align: justify;">
	Concerned over the ongoing austerity measures, high unemployment rate and lower business confidence combined with weak market sentiments in core global economies like the USA and Eurozone, the World Bank (WB) has lowered its forecast for 2013. Market analysts and global institutions, pioneering in economic forecasts, are coming up with new lowered growth forecasts for the current year in line with lower than expected manufacturing and trade indicators coming from both sides of the Atlantic. The world economy was initially expected to grow by 3 percent in 2013. However, the new growth forecast based on the current and prospect scenario has come out to be 2.4 per cent, lowered by 60 basis points from the initial forecast.&nbsp;</p>
<p style="text-align: justify;">
	Similarly, amidst reduced global growth, market analysts and economists from around the world have lowered their growth forecast for the ‘land of the rising sun,’ i.e., Japan, US and the more vigilant economy, the Eurozone. It is believed that the second year of contraction in the Eurozone will have a tremendous impact on the global economy and could act as a reverse-catalyst in the global economic atmosphere, measured by Global Purchasing Managers’ Index or any other global index. Having inter-twined relationship with economic superpowers &nbsp;such as China, Eurozone and the US, emerging economies like India, Brazil, Mexico and other East-Asian economies fear that they cannot remain unaffected by the contraction in the economic environment of the world’s economic hubs. However, developing economies from around the globe are expected to expand at the rate of above 5.5 per cent in 2013.</p>
<p style="text-align: justify;">
	The World Bank has already warned against the fragility and vulnerability of the global economy in the remaining months of 2013. On the other hand, the report has also emphasized that the magnitude of economic downside will be at decreasing rate compared to recent precursor years. If we turn back and scrutinize 2012, European measures, reforms and policies to cushion the financial/debt crisis in the single economic bloc have not been able to provide economic surge or even correction to the ongoing recession. At a time when financial and political agendas have not been facilitating economic improvement in the single currency bloc, issues related to spending cuts and tax hikes in the US, diplomatic tensions between Japan and China affecting trade environment, and ‘not so good’ manufacturing and industrial indicators coming from the US and China are feared to cloud whatever little optimism remains for &nbsp;the ongoing year.</p>
<p style="text-align: justify;">
	<strong>Global Economic Growth Forecast for 2013</strong></p>
<p>
	<strong><img align="left" alt="Economy and policy February 2013" height="230" src="http://www.newbusinessage.com/ckfinder/userfiles/Images/economy_policy_feb2013.jpg" style="margin: 0 10px 0 0; " width="250" /></strong></p>
<p style="text-align: justify;">
	Considering the gloom in the world economic regimes in 2012 and the grayish ongoing global economic performance, the US in 2013 is forecasted to grow by 1.9 per cent. With political tensions mounting between two core Asian economies, Japan and China, amid affected Japanese trade in automobiles and related industries, and with contraction in one of the largest export sectors, the Japanese economy is expected to witness a meager growth of only 0.7 per cent in 2013. Unlike the economies mentioned above, the Chinese economy with its improving manufacturing sector, satisfactory flow of Foreign Direct Investment and export data has been projected to grow by an attractive 8.4 per cent in 2013, though the figure is 20 basis points lower than the previous projection for the year. Further, increasing Chinese appetite for FDI outflow also exhibits the magnitude of its economy. Moving on to emerging economies, the growth rates for India, Brazil and Mexico have been projected to be 6.1, 3.4 and 3.3 percent, respectively. With economies like the Eurozone and the USA not really supporting these emerging economies, these expected growth rates could be deemed satisfactory.</p>
<p style="text-align: justify;">
	<strong>Nepali Economy in 2013 and Global Influence</strong></p>
<p style="text-align: justify;">
	Nepali exports have seen a decline in recent months, thanks to the economic slowdown in the Euro Area and a mild US economy. Nepali industries like, garment, herbs, handicraft, carpet, metal-wood and other related sectors are hit hard by the global meltdown. Combined with the international pessimism, ‘below-par’ agricultural and industrial performance is also contributing to drag the economy towards austerity. In line with the current and forecasted economic indicators, the WB has forecasted Nepal’s economic growth rate to be 3.8 per cent for fiscal year 2012-13, which is 80 basis points lower than the actual economic growth rate for fiscal year 2011-12.</p>
<p style="text-align: justify;">
	The key issues contributing to lowered growth forecast could be attributed to the ongoing constitutional crisis, poor investment environment (in terms of FDirectI) and infrastructural bottlenecks in the country. Besides the ongoing political instability and poor market sentiments, inadequate and inefficient public expenditure, too, has been hampering the economic outlook, which, in turn, may further contribute to downgrading the current forecasted growth rate. Remittance, working as a key source of financing, incorporates around 22 per cent of the national Gross Domestic Product (GDP). At this point of economic junction, as remittance has been facilitating to finance imports, covering trade deficits with counterparts, the year ahead could also see an optimistic inflow of funds, taking into account the numbers of Nepalis working abroad, especially in the Gulf countries.</p>
<p style="text-align: justify;">
	With the WB having already lowering Nepal’s growth forecast for fiscal year 2012-13 and remittance acting as an economic catalyst, it’s political leaders and government authorities who could possibly look into the matter and plug the loopholes in the operating environment, eventually facilitating, promoting and simplifying investment grounds for national and international market participants. Only time would tell what the government would do to address the situation and improve the country’s GDP growth rate, lower dependency on remittance and international debts for the year and henceforth.</p>
<p style="text-align: justify;">
	<strong>The author is Assistant Manager, Research &amp; Development Department, Mercantile Exchange Nepal Limited, Nepal.</strong></p>',
			'published' => true,
			'created' => '2013-03-15',
			'modified' => '2013-03-15',
			'keywords' => '',
			'description' => 'Concerned over the ongoing austerity measures, high unemployment rate and lower business confidence combined with weak market sentiments in core global economies like the USA and Eurozone, the World Bank (WB) has lowered its forecast for 2013.',
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	(int) 12 => array(
		'Article' => array(
			'id' => '860',
			'article_category_id' => '31',
			'title' => 'Visiting Business People: February 2013',
			'sub_title' => '',
			'summary' => null,
			'content' => '<p>
	<strong><span style="font-size:16px;">‘We help people make good change take root’</span></strong></p>
<p>
	<img align="right" alt="Bill Stockton" height="286" src="http://www.newbusinessage.com/ckfinder/userfiles/Images/bill_stockton_visiting_business_people(1).jpg" style="margin:5px 0 10px 10px;" width="250" /><strong> </strong></p>
<p style="text-align: justify;">
	<span style="color:#f00;">Bill Stockton</span> is a Senior Advisor of the Verghis Group, a management consulting firm.<span style="text-align: justify;">He is known as the ‘center of gravity’ for knowledge sharing practice and consulting within the financial sector including investment and retail banking and insurance companies in the Verghis Group. Stockton graduated in Psychology from the University of North Carolina at Chapel Hill. He served Deutsche Bank for 18 years, mainly in the IT department. &nbsp;He was the director and global head of support and operations for over 20 products including foreign exchange, equities, programme trading, cash management and more. Most recently, he was tapped by Deutsche Bank to institute a global knowledge sharing programme that trained over 3200 IT staff and demonstrated productivity gains. In an interview with Nubiz recently when he was in Kathmandu, Stockton shared the importance and need of knowledge sharing and knowledge management in any organization.&nbsp;</span></p>
<p>
	<strong><strong>Excerpts:&nbsp;</strong></strong></p>
<p style="text-align: justify;">
	<strong><strong>What are your recent engagements?</strong></strong></p>
<p style="text-align: justify;">
	I left Deutsche Bank as a Director and as an IT Manager. I left because I think I can do much more, particularly in the area of knowledge sharing in finance companies. We have three small companies in the Verghis Group. We can resolve things primarily on knowledge sharing and knowledge management. Also, we do a quite a lot of work on measures, metrics and madness which is about stopping measuring activities and reassuring for outcome. We do also have a research wing which conducts very exciting research, mostly on behaviour psychology- the kind of research we primarily conduct.&nbsp;</p>
<p style="text-align: justify;">
	<strong><strong>What brings you to Nepal?</strong></strong></p>
<p style="text-align: justify;">
	My ancestors had been coming to Nepal for a long time. We did not come here for business. We came here because we are interested in all the things we have heard about Nepal.&nbsp;</p>
<p style="text-align: justify;">
	<But my partner, Christina, has come here several times a year for the past ten years. &nbsp;Her visits are mainly aimed at supporting organizations like Sano Paila in Birgunj and other women’s groups for social service. Professionally, she is a doctor in psychology and has done quite a lot of work in areas like peace negotiation and conflict management. She is also from the leadership training which is mostly about working with people who don’t usually talk together productively. So, I joined her on a number of those session conducted here.&nbsp;</p>
<p style="text-align: justify;">
	>There are some really exciting possibilities in my mind about knowledge sharing. Many people don’t know what knowledge sharing or knowledge management is. A number of companies need knowledge management. Research show whether it be Deutsche Bank, Mega Bank or Coca-Cola - around 60-90 percent problem is solved by somebody else in the organization. So, knowledge management is about the behaviour and practices required to make that knowledge available to anyone who needs it in the organization.&nbsp;</p>
<p style="text-align: justify;">
	What I see is, when you get a really good idea you don’t want anyone else to know that idea. You try it just by yourself. But in today’s new Internet age, if you put your ideas right there, other people can come and collaborate. The more I share what I know, the more valuable I become. People have trouble doing that and they have also trouble believing that.&nbsp;</p>
<p style="text-align: justify;">
	<strong><strong>How does your strategy help other organizations?&nbsp;</strong></strong></p>
<p style="text-align: justify;">
	We teach companies how to capture the intellectual capital of the employees in all sorts of makeshift and inefficient repositories so that once a problem is solved, future occurrences of the same or similar problems will be prevented or resolved much faster.&nbsp;</p>
<p style="text-align: justify;">
	<strong><strong>What prospects do you see for your business in Nepal? &nbsp;</strong></strong></p>
<p style="text-align: justify;">
	These are universal problems faced by companies from Wall Street in New York to Kantipath in Kathmandu. We tailor our work to each customer not only to offer services at a good price but also to determine whether or not we think we can add value to our clients.</p>
<p style="text-align: justify;">
	<strong><strong>&nbsp;What are your plans?&nbsp;</strong></strong></p>
<p style="text-align: justify;">
	We have several research projects underway. These projects are about ensuring better client satisfaction during a tech support or services support call. We are also putting together an online site to help make organizational change stick. Change is so difficult to anchor and become “sticky”. We help people make good change take root while helping organizations and businesses prioritize and differentiate between doing the right things and doing things right.</p>',
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			'keywords' => '',
			'description' => 'Bill Stockton is known as the ‘center of gravity’ for knowledge sharing practice and consulting within the financial sector including investment and retail banking and insurance companies in the Verghis Group.',
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		'Article' => array(
			'id' => '859',
			'article_category_id' => '60',
			'title' => 'Etihad’s New Daily Flights To Brisbane And Singapore',
			'sub_title' => '',
			'summary' => null,
			'content' => '<p>
	<img alt="Etihad Airways" height="229" src="http://www.newbusinessage.com/ckfinder/userfiles/Images/etihad_airways(1).jpg" width="500" /></p>
<p style="text-align: justify;">
	Etihad Airways, the national airline of the United Arab Emirates, has commenced its new schedule of daily flights between Abu Dhabi and Brisbane via Singapore this week (give the exact date). To mark the occasion, Etihad Airways operated ‘Blue Moon Rising’, its Airbus A330-200 painted in Manchester City Football Club colours on the commemorative February 1 flight. James Hogan, President and Chief Executive Officer of Etihad Airways, said that the new daily service would add an extra 1,048 seats a week to the Abu Dhabi-Singapore-Brisbane route. “The additional capacity puts Etihad Airways in a stronger than ever position in the Singapore and Australian markets. It enables us to compete on a more level playing field than in the past,” said Hogan. He also said that the airline was working closely with government and industry stakeholders in each market to ensure the route’s continuing success.&nbsp;</p>
<p style="text-align: justify;">
	Etihad Airways commenced three weekly flights to Brisbane and Singapore on September 28, 2007. The Queensland capital was the airline’s second destination in Australia and the 43rd in its global network. The airline operates its state-of the-art Airbus A330-200 aircraft on the Abu Dhabi- Singapore-Brisbane route. The aircraft is configured in two classes with 22 seats in Pearl Business Class and 240 seats in Coral Economy Class.&nbsp;</p>
<div style="text-align: justify;">
	 </div>',
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			'created' => '2013-03-15',
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			'keywords' => '',
			'description' => 'Etihad Airways has commenced its new schedule of daily flights between Abu Dhabi and Brisbane via Singapore this week',
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			'title' => 'Oman Air’s Special Companion Scheme',
			'sub_title' => '',
			'summary' => null,
			'content' => '<p>
	<img alt="Oman Air" height="152" src="http://www.newbusinessage.com/ckfinder/userfiles/Images/oman_air.jpg" width="150" /></p>
<p style="text-align: justify;">
	Oman Air is offering a Special Companion scheme for Business class for a period of 20 days from February 1 to 20.The airlines has informed that the travel can be completed by 31 May 2013. According to the airline, the customers can avail this offer by contacting their travel agents.</p>',
			'published' => true,
			'created' => '2013-03-15',
			'modified' => '0000-00-00',
			'keywords' => '',
			'description' => 'Oman Air is offering a Special Companion scheme for Business class for a period of 20 days from February 1 to 20.',
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			'title' => 'Beer Ads On Nepali Television? Why Not?',
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	<strong style="text-align: justify;">By Abhaya Panday</strong></p>
<p style="text-align: justify;">
	<img alt="Advertising, February 2013" height="190" src="http://www.newbusinessage.com/ckfinder/userfiles/Images/advertising_feb2013.jpg" width="350" /></p>
<p style="text-align: justify;">
	One fine day in 1999 AD, the then His Majesty’s Government decided to ban beer ads on the television. Media reports suggest that it was done under the recommendations of the WHO, the organization which holds immense influence over a poor country like ours. The fact that the same ‘world body’ becomes powerless about the beer ads in countries like the USA is another story altogether. Rumours following the ban also suggested that the decision was made at the behest of a business house which enjoyed monopoly in the country’s beer market. Banning the beer ads on TV would have made it an uphill task for new entrants to increase their market share and thus that ban would have been in the interest of the market leader.&nbsp;</p>
<p style="text-align: justify;">
	But whatever the reasons, apparent or underlying, that is irrelevant. What is important is to question the basis on which the government of the day chose to impose the ban. And why did the party in power, which brands its ideology as the most scientific and revolutionary, choose to continue the legacy of the ‘old regime’? Had the ‘old regime’ conducted a reliable scientific research on the effects of beer ads on its consumption? Let’s forget about a reliable and scientific research for a moment. Did the government conduct any research at all? Nothing suggests that it did. The decision was arbitrary and arbitrariness has become the founding principle of the state in relation to advertising. The latest example of this arbitrariness is the recent decision of one-door policy for government ads.&nbsp;</p>
<p style="text-align: justify;">
	Does the Ministry of Information and Communications (MoIC) possess more expertise in appropriating government ads than the other ministries? Evidence of arbitrariness was seen in the recent past when the Insurance Board decided to curb the spending of insurance companies on their promotional activities, thus negatively affecting the advertising industry. Sometime back, the TV commercial I had made for Digital Cable TV was banned by the MoIC without any clear cut policy on comparative advertising and in the absence of an independent and competent regulatory body on advertising. These are just a few examples which highlight the attitude of the state towards advertising. &nbsp;</p>
<p style="text-align: justify;">
	Let me get back to the ban on beer ads on television. Was it necessary to impose the ban? I don’t think so. Because the assumption that beer advertising results in the increase of overall consumption is unfounded. First, the objective of any advertising exercise is to influence purchase decisions, not to increase the overall consumption. Moreover, in a product category like alcohol that is already widely consumed- in one form or the other- increasing the overall consumption of alcohol is an objective unworthy of pursuit for an advertiser. From the viewer’s perspective, does watching beer ads on TV help the drinker consume more beer than he/she normally does? Or does it entice a non-drinker to have a pint or more? Is advertising the ‘cause’ or the ‘effect’ of alcohol consumption? If the government believes that advertising is the ‘cause’ then perhaps it overestimates the power of advertising. In that case, the government should let the advertising agencies run the nation and by the sheer power of advertising, they shall eradicate all the evils of society. The fact that commercial advertising is mostly the reflection of the society’s values and aspirations and not the cause puts the power of advertising in the proper perspective.&nbsp;</p>
<p style="text-align: justify;">
	Whether beer ads actually increase the overall consumption is an issue that has been raised in the US Parliament more than once. In response, the Federal Trade Commission, The Department of Health and a Senate subcommittee have submitted their reports on different occasions. And their findings suggest a clear absence of correlation between beer advertising and beer consumption. A 21-year long study conducted by Texas University also corroborates the findings. And let’s not forget that we are discussing a country whose per capita alcohol consumption is four times more than that of ours. Some countries in Europe have the figures six times as much, yet beer advertising enjoys considerable freedom in those countries. Of course, the content and placement of beer advertising is regulated and that is what we should be doing in Nepal. Lift the ban on beer advertising on TV and regulate the content and placement. Ironically, the government ignored to impose the ban in the print media, probably under the impression that print advertising is less effective than TV advertising.&nbsp;</p>
<p style="text-align: justify;">
	Is beer drinking good or bad for health? Is moderate drinking medically acceptable or even beneficial? These are medical issues that should be addressed by the medical and health experts. Why do people begin consuming alcohol and, when they do, why do some turn alcoholics? Will we become a better society if we impose a total ban on alcohol? These are different issues altogether. I am neither a medical expert nor a sociologist and nor a psychologist. But as an advertiser, I am led to believe, on the basis of various scientific research conducted in countries where credible scientific &nbsp;research are produced, that advertising of beer on TV does not promote its overall consumption.&nbsp;</p>
<p style="text-align: justify;">
	Advertising, in this view, can only influence the choice of the brand. You may choose to drink beer A instead of beer B, having been influenced by the advertisement of A. But it is most unlikely that you will drink more than what the context allows or, as a non-drinker, you will decide to drink beer A without the psychological need. If the government wants to reduce the consumption of beer or alcohol, then it must address the issues surrounding the psychological and social needs that lead to the consumption of beer or alcoholic products in general. Necessity is not only the mother of invention but also consumption. &nbsp;Kill the enemy, if you can. Don’t kill the messenger.&nbsp;</p>
<p style="text-align: justify;">
	<span style="font-size:11px;">The writer is an advertising professional.</span></p>',
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			'description' => 'The decision was arbitrary and arbitrariness has become 
the founding principle of the state in relation to advertising.',
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		'Article' => array(
			'id' => '872',
			'article_category_id' => '40',
			'title' => 'The Pooling Mechanism Is To Stabilize The Insurance Market',
			'sub_title' => '',
			'summary' => null,
			'content' => '<p>
	<strong style="color: rgb(35, 200, 250); font-size: 16px; text-align: right;">‘The pooling mechanism is to stabilize the insurance market’</strong></p>
<p>
	<strong><img align="right" alt="Mahendra Shrestha, Himalayan General Insurance" height="301" src="http://www.newbusinessage.com/ckfinder/userfiles/Images/mahendra_cover_feb2013.jpg" style="margin:0 0 0 10px;" width="250" /></strong></p>
<address style="text-align: right;">
	<strong>Mahendra Shrestha</strong></address>
<address style="text-align: right;">
	<strong>Managing Director</strong></address>
<address style="text-align: right;">
	<strong>Himalayan General Insurance</strong></address>
<p style="text-align: justify;">
	 </p>
<p style="text-align: justify;">
	<strong>What is your company’s stake in the aviation insurance market?</strong></p>
<p style="text-align: justify;">
	Himalayan General has been writing aviation insurance since 1998 and it is a portfolio we continue to be interested in.</p>
<p style="text-align: justify;">
	<strong>It is said that some insurance companies are trying to form a pool to collectively handle the aviation insurance claims. What is the latest progress in this regard?</strong></p>
<p style="text-align: justify;">
	Preliminary discussions have been initiated for the formation of aviation insurance pool. The formation of such a pool will not only allow insurance companies to gain capacity but also make it viable for the re-insurers to continue supporting Nepal’s aviation insurance market.</p>
<p style="text-align: justify;">
	<strong>What future do you see for the aviation insurance business in Nepal?</strong></p>
<p style="text-align: justify;">
	It is a portfolio which is an absolute necessity in Nepal and one that will continue to grow.</p>
<p style="text-align: justify;">
	<strong>Aviation insurance premium in Nepal is said to be one among the highest in the world? Why is it so high? How can we lower it?</strong></p>
<p style="text-align: justify;">
	Aviation insurance premium in Nepal is certainly very high. Some big losses in the last few years have pushed up the premium rates substantially. The continually rising premium rates are, of course, a serious concern because they impact the sustainability of the business. The pooling mechanism is one of the possibilities we are exploring in order to stabilize the market. Eventually, if the total premium paid is more than the total amount claimed in losses, we hope the premium will start to come down.</p>
<p style="text-align: justify;">
	What are the key challenges and issues facing the aviation insurance industry in Nepal and what needs to be done to address these challenges?</p>
<p style="text-align: justify;">
	Rising premium rates and shrinking market capacity are two major challenges the aviation insurance industry is currently facing. The Aviation Insurance Summit was one way to address these challenges and find a common direction for improvement and growth.</p>
<p style="text-align: justify;">
	<strong>The country’s first-ever aviation insurance summit was organized in the capital recently. How helpful was this summit?</strong></p>
<p style="text-align: justify;">
	The Summit brought local stakeholders, including operators, regulatory bodies, insurance companies and banks as well as key players in the regional and global aviation insurance industry (including underwriters and re-insurance brokers) under one roof. It gave the Nepali stakeholders a global perspective on our current situation as well as access to the expertise of visiting delegates, all of whom have extensive experience in this sector, including in other countries with contexts similar to Nepal.</p>
<p style="text-align: justify;">
	All the delegates who attended the Summit said that they had found it to be a helpful introduction to the Nepal aviation insurance market, adding that it will help them take better decisions for supporting it.</p>',
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			'description' => 'The continually rising premium rate is a serious concern because they impact the sustainability of the business. The pooling mechanism is one of the possibilities we are exploring in order to stabilize the market.',
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		'Article' => array(
			'id' => '871',
			'article_category_id' => '40',
			'title' => 'We Are More Aware About  The Safety Concerns Today Than In The Past',
			'sub_title' => '',
			'summary' => null,
			'content' => '<p>
	<strong style="color: rgb(35, 200, 250); font-size: 16px; text-align: right;">‘We are more aware about the safety concerns today than in the past’</strong></p>
<p>
	<img align="right" alt="Rameshwor Thapa, Airlines Operators Association of Nepal " height="314" src="http://www.newbusinessage.com/ckfinder/userfiles/Images/rameshwor_cover_feb2013.jpg" style="margin:0 0 0 10px;" width="250" /></p>
<address style="text-align: right;">
	<br />
	<strong>Rameshwor Thapa</strong></address>
<address style="text-align: right;">
	<strong>President&nbsp;</strong></address>
<address style="text-align: right;">
	<strong>Airlines Operators Association of Nepal (AOAN)</strong></address>
<p>
	<strong><br />
	</strong></p>
<p style="text-align: justify;">
	<strong>What is the size of the aviation insurance market in Nepal?</strong></p>
<p style="text-align: justify;">
	When talking about the insurance size, the Nepali aviation insurance business is small in global comparison. However, it has an addressable size in the context of the South Asian countries. That means the aviation insurance market in Nepal is neither big nor small but of medium size in terms of money as well as the number of insurers involved in this business. We now pay USD 8 to 9 million in premium to international companies annually.&nbsp;</p>
<p style="text-align: justify;">
	<strong>Why is the aviation insurance premium so high in Nepal? How can we lower it?</strong></p>
<p style="text-align: justify;">
	The re-occurrence of air crashes have contributed to the increment of aviation insurance premium. The open sky aviation policy has helped the mushrooming of airliners in Nepal while the infrastructure remains almost the same. And there may be many issues concerning safety issues. The dramatic increase in premium is also because of the climate and weather. Importantly, trunk route operators have fewer problems in comparison to the STOL (short takeoff and landing) route operators mainly because of the high hills and high altitude. In STOL, mainly in helicopters, there are many instances of accidents beyond what could be conconsidered as normal. &nbsp;</p>
<p style="text-align: justify;">
	Now there are more airports and other facilities which could be rated higher in safety. We are organizing many safety seminars and programmes to lower the premiums with the safety much assured. There have been programmes enhancing the safety measures and we are very much confident that we would be able to enhance safety measures. We are more aware about the safety concerns today than in the past. The audit reports by ICAO and other organizations have diversified it further and made it clear also. Aircraft and passenger safety should be the airliners’ main concern. If we maintain all this - for enhanced safety in the aviation sector - definitely the premium will come down.&nbsp;</p>
<p style="text-align: justify;">
	<strong>There have been more than 50 major accidents in the past 10 years. Why is the frequency of aerial accidents so high in Nepal?&nbsp;</strong></p>
<p style="text-align: justify;">
	It is very sad and bitter fact. The increasing premium in aviation insurance is making it difficult for the airline companies. These days we are trying to improve the security in the aviation sector and are not expecting such accidents again. We are working to reduce such accidents by organizing different seminars and programmes to enhance safety in the aviation sector. Through these safety seminars, we are being able to make the stakeholders aware about air safety. There, we make the pilots aware about focusing on safety while the stakeholders update themselves with different issues and activities in the aviation sector. All the people involved in this sector should understand that not compromising any safety measures but maintaining them will help mitigate the risks. Visual Flight Regulation (VFR) should not be allowed to go through the clouds. &nbsp;If we follow all these safety measures, definitely the risks have to go down. Civil Aviation Authority of Nepal (CAAN) should monitor these flights and instruct accordingly.&nbsp;</p>
<p style="text-align: justify;">
	<strong>The annual claims payout in the aviation insurance has been constantly rising. This is bound to further increase the already significantly high aviation insurance premium. How are we going to tackle this problem?</strong></p>
<p style="text-align: justify;">
	We are concerned about this problem. Basically, if we are able to enhance safety measures, it would help to lower the premium paid out to reinsurance companies. Most of the re-insurers are quite convinced that we would be able to maintain safety properly. End of the Maoist war has also spread positive message to the reinsurers. In the past, we had to pay US$ 60 million premium in third party liability though we owned small aircraft. After knowing the problem, Nepal government addressed this. And now we have to pay some 10 million dollars for the same. The thing is, once we fix the safety problem, the premium will come down.&nbsp;</p>
<p style="text-align: justify;">
	<strong>There are various types of aviation insurance policies in the world. Are all of them available in Nepal?</strong></p>
<p style="text-align: justify;">
	There are not various types of insurance policies in the aviation insurance. The available insurances are air-craft’s insurance, passenger’s insurance, cargo insurance, crew-members insurance- including others. There are insurance policies with same periphery and nature and are normally practiced in other countries as well. Now there are different types of reinsurance market but the problem is they take our situation as an alarming one. I think the situation is not that alarming. Some of the reinsurance companies really want to work and support the Nepali aviation sector which includes Indian as well as western reinsurance companies. A new aviation group in Malaysia is also interested in this business. Moreover the re-insurer companies are not of various types; they are of a singular nature and type.&nbsp;</p>
<p style="text-align: justify;">
	<strong>The country’s first-ever aviation insurance summit was organized in the capital recently. What’s your impression of the summit?&nbsp;</strong></p>
<p style="text-align: justify;">
	It was definitely helpful to us. I think the reinsurance companies that were finding threats in our sky are convinced that the premium which we are paying is not justifiable. We hope that in the coming days they won’t increase the premiums and won’t take our sky as an alarming one for aviation insurance. They got a chance to understand our aviation environment and we had a chance to put the reality in front of them. We were able to prove that there is neither any violence in the country nor any threat in the aviation sector. We were able to prove that we are quite committed to maintaining safety and that we are continuously working on it. We have learnt from past accidents and we are committed to avoiding such accidents.&nbsp;</p>',
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			'description' => 'Most of the re-insurers are quite convinced that we would be able to maintain safety properly. End of the Maoist war has also spread positive message to the re-insurers.',
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		'Article' => array(
			'id' => '870',
			'article_category_id' => '40',
			'title' => 'Now Is The Challenge Of Getting Right Reinsurer At A Competitive Price',
			'sub_title' => '',
			'summary' => null,
			'content' => '<p>
	<strong style="color: rgb(35, 200, 250); font-size: 16px; text-align: right;">‘When the losses start decreasing, the premium will come down’</strong></p>
<p style="text-align: justify;">
	<strong><img align="right" alt="Kewal Krishna Shrestha, Everest Insurance" height="316" src="http://www.newbusinessage.com/ckfinder/userfiles/Images/kewal_cover_feb2013.jpg" style="margin: 0 0 0 10px;" width="250" /></strong></p>
<address style="text-align: right;">
	<strong>Kewal Krishna Shrestha&nbsp;</strong></address>
<address style="text-align: right;">
	<strong>President, Nepal Insurers Association &amp;</strong></address>
<address style="text-align: right;">
	<strong>CEO, Everest Insurance</strong></address>
<p style="text-align: justify;">
	<strong><br />
	</strong></p>
<p style="text-align: justify;">
	<strong>What is the size of the aviation insurance market in Nepal?</strong></p>
<p style="text-align: justify;">
	The market size is around Rs 420- 500 million in terms of the premium we collect from our clients.&nbsp;</p>
<p style="text-align: justify;">
	<strong>What about your company’s stake in the market?</strong></p>
<p style="text-align: justify;">
	We own around 25-30 per cent share in Nepal’s aviation insurance market.&nbsp;</p>
<p style="text-align: justify;">
	<strong>It is said that some insurance companies are trying to form a pool to collectively handle the claims on aviation insurance. Are you aware of the latest progress in this regard?</strong></p>
<p style="text-align: justify;">
	I don’t think the pool is what we need to improve the aviation insurance business. Now we are competing to get the lowest rate from reliable companies (reinsurers) but if such a pool is formed, there would be monopoly in the insurance market and there would be no competition. Insurance companies could syndicate the aviation insurance business and the situation could worsen further. The premium will be at a high rate and the airliners will raise the ticket price which in turn will make air travelling difficult. It seems beneficial to all of us but if we view it minutely it is only a means of syndicating that could affect the whole country economically. &nbsp;</p>
<p style="text-align: justify;">
	However, if such pool is sure to be formed we could form this pool in two ways. One, we can calculate certain risks in the aviation industry and other, we can focus on the risks involved in the hull, baggage etc. However creating such a pool needs lots of vision.&nbsp;</p>
<p style="text-align: justify;">
	Beema Samiti recently organized an interaction programme on the possibilities of merger between &nbsp;insurance companies. This interaction was a good initiation in the insurance business but I think both the government and Beema Samiti should be well prepared on it. It needs lots of homework and researches whether to form a pool or to merge the insurance companies.&nbsp;</p>
<p style="text-align: justify;">
	<strong>What future do you see for the aviation insurance business in Nepal?</strong></p>
<p style="text-align: justify;">
	The prospects of aviation business in Nepal depend on the growth of the airliners. The more airlines are there, the better for the aviation insurance business. The theory of demand and supply is applied in the aviation business also. Many airlines are not functioning well and some of them have registered but have not started their operation yet. If new airliners start operating it would benefit both the airliners and the aviation industry. &nbsp;Development of airports and runways in a sustainable way can also sustain airliners. And the development of airliners ultimately grows the aviation insurance business. Since there is a lot of prospects in the tourism sector, I see bright future of aviation insurance business.&nbsp;</p>
<p style="text-align: justify;">
	<strong>Aviation insurance premium in Nepal is said to be one among the highest in the world? Why is it so high?</strong></p>
<p style="text-align: justify;">
	No, I disagree with this. We used to pay 8-9 per cent premium some 10 years ago and we were able to reduce that as low as 2 per cent later. Now again the reinsurance companies are charging the same old rate or even higher. It is mainly because of the risk factors in the aviation industry of Nepal and I don’t think it is unjustifiable. The terrain, safety measures in the aviation industry in Nepal and lack of maintaining safety standards by all the stakeholders involved in the aviation industry are some of the reasons behind the increment of premium. We lack the standard safety measures in spite of ICAO advice.&nbsp;</p>
<p style="text-align: justify;">
	<strong>What do you expect from the Beema Samiti or the government for that matter to facilitate the aviation insurance business in the country? &nbsp;</strong></p>
<p style="text-align: justify;">
	The government can enforce the safety standards. It can properly manage the runways, ground handling, and certify efficiency of the people and the equipment used in the aircraft or for the aircraft maintenance. If you see how the baggage in airports is handled, you will find how improperly things are done. The baggage is loaded in tractors and the insurer has to pay if there is a damage. Furthermore, the international airport in Nepal is very crowded. I think the TIA should now be shifted to some convenient place.&nbsp;</p>
<p style="text-align: justify;">
	<strong>What are the key challenges and issues facing the aviation insurance industry in Nepal?</strong></p>
<p style="text-align: justify;">
	Now is the challenge of getting the right reinsurer at a competitive price. The aviation business is anyway running though the reinsurers are charging up to 12 per cent. But what if they charge 20-25 per cent? I don’t think aviation in Nepal could bear such high premium rates. Moreover, the environment could be such that even the high premium might not draw reinsurers into confidence. Because of the high risk involved in this business, the reinsurers could add more clauses which could affect the overall aviation business in Nepal. And then it will be hard to find reliable reinsurers and we will have to reinsure with whichever party we find. When the claim increases, the premium market becomes hard and reinsurers hesitate to do business. And aviation insurance is driven by reinsurers. Unless the scenario of this seller-driven market changes, we won’t have any other alternative.&nbsp;</p>
<p style="text-align: justify;">
	<strong>What needs to be done to address these challenges?</strong></p>
<p style="text-align: justify;">
	CAAN has to be strong. All the stakeholders of the aviation industry should maintain the safety standards prescribed by ICAO in terms of physical amenities, ground handling, aircraft maintenance, tracing of the aircraft personnel etc. Maintaining the safety standard is the foremost requirement. Everybody in the aviation industry should strictly follow the policies and run under rules and regulations of the government. &nbsp;</p>
<p style="text-align: justify;">
	<strong>The annual claims payout in the aviation section has been constantly rising. This is bound to further increase the already significantly high aviation insurance premium. How are we going to tackle this problem?</strong></p>
<p style="text-align: justify;">
	This is not a problem; it’s an outcome which is natural. When claims payout in the aviation sector starts increasing, increment in the premium is normal internationally. &nbsp;And when the claims start rising, the party is affected and slowly it affects other airliners. When the risk is found the reinsurer loads the premium and that is considered normal in the insurance business.&nbsp;</p>
<p style="text-align: justify;">
	When safety measures are properly followed the risk has to go down. For this, all the stakeholders in the aviation industry should come together and contribute. &nbsp;Evaluation of our work and adopting things that make this business ideal as well as searching ways of perfection in the aviation business is a must.&nbsp;</p>',
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			'description' => 'Now we are competing to get the lowest rate from reliable companies (reinsurers) but if such a pool is formed, there would be monopoly of the insurance companies and there would be no competition.',
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		'Article' => array(
			'id' => '869',
			'article_category_id' => '40',
			'title' => 'When The Losses Start Decreasing, The Premium Will Come Down',
			'sub_title' => '',
			'summary' => null,
			'content' => '<p>
	<strong style="color: rgb(35, 200, 250); font-size: 16px; text-align: right;">‘When the losses start decreasing, the premium will come down’</strong></p>
<p>
	<img align="right" alt="Pronab Sen, National Insurance Company Ltd" height="317" src="http://www.newbusinessage.com/ckfinder/userfiles/Images/pronab_cover_feb2013.jpg" style="margin: 0 0 0 10px;" width="250" /></p>
<address style="text-align: right;">
	<strong>Dr Pronab Sen&nbsp;</strong></address>
<address style="text-align: right;">
	<strong>Chief Executive Officer,&nbsp;</strong></address>
<address style="text-align: right;">
	<strong>Nepal</strong><strong>National Insurance Company Ltd</strong></address>
<p>
	 </p>
<p style="text-align: justify;">
	<strong>What is your company’s stake in the aviation insurance portfolio?</strong></p>
<p style="text-align: justify;">
	We are moving very selectively in the aviation insurance in Nepal. Previously, Guna Air was 100 per cent with us and now Simrik Air has taken it over. There are some airliners which are having reinsurance support from our corporate office in India- like Buddha Air. We have around five percent market share in the aviation portfolio. Agni Air is co-insured with Shikhar Insurance – 60 percent with them and 40 per cent with us. Another airline in Pokhara has insured 49 per cent with us and 51 per cent with Shikhar. We are now negotiating with Simrik because Guna was with us. &nbsp;</p>
<p style="text-align: justify;">
	We are the direct branch of a reinsurance company in India governed by the Indian Government. We have high retention capacity. We reinsure the portion to other reinsurance companies that is beyond our financial strengths. This is a worldwide phenomenon in insurance business. It depends on portfolios and varies from risk to risk. Sometimes, we retain 20 per cent and sometimes 90- depending on the risks.</p>
<p style="text-align: justify;">
	<strong>Is it true that the insurance companies in Nepal have not been able to make profits from aviation insurance? Why?</strong></p>
<p style="text-align: justify;">
	Yes it is true. And the reason is there are a number of airliners which are very small in size. It may be also because of the weather and terrain of Nepal. Small airliners and aviation companies do not afford expertise and there are few airliners where I have seen the full expertise – this is the biggest challenges for the Nepali aviation sector. Many of the aircraft are also very old. &nbsp;</p>
<p style="text-align: justify;">
	Some of the insurance companies have retention capacity of 0.4 per cent and rest is reinsured. These companies are getting only the reinsurance commission. &nbsp;</p>
<p style="text-align: justify;">
	<strong>Some insurance companies are trying to form a pool to collectively handle the aviation insurance claims. What is your view on this proposal?</strong></p>
<p style="text-align: justify;">
	It is still in the pipeline. Nothing concrete has come out so far. But if such a pool is formed, it will help both the aviation insurers as well as the airliners. After the formation of the pool, they don’t have to run around different countries trying to find out the lowest rate. Once the pool is formed, they know that they have to approach only one office which will organize everything. And the office will be the consortium of a number of insurance companies.&nbsp;</p>
<p style="text-align: justify;">
	<strong>What future do you see for aviation insurance business in Nepal?</strong></p>
<p style="text-align: justify;">
	The future is good because there is a tremendous growth in the tourism sector in Nepal. The tourism sector has a tremendous scope and the more this sector grows, the more the aviation sector expands. More people prefer to travel by air in Nepal considering the time taken in travelling by roads. By air you reach Pokhara in 20-25 minutes.But if you take a bus, it takes 5- 6 hours. And the growth of airliners has paved the road for growth of the aviation insurance companies.&nbsp;</p>
<p style="text-align: justify;">
	<strong>Almost whatever the insurance companies earn from the aviation segment goes to the reinsurance companies abroad. Some are even said to be making losses in the aviation segment. It is said that the companies know that they are not going to make profits from the aviation segment. But they do aviation insurance just to show high insurance premium collection. What do you say?</strong></p>
<p style="text-align: justify;">
	It is not like that. The premium is based on the past losses. If you see the statistics, almost every year there is an air crash and some years, there are around two air crashes in Nepal. And the rate of premium is governed by the reinsurance market. Because of the air accidents, some of the reinsurers were hesitant to do business in Nepal. The aviation summit last month also put forth lots of similar issues in the aviation industry- the dos and the don’ts. Beyond that, the aviation business has a very bright future.&nbsp;</p>
<p style="text-align: justify;">
	<strong>Aviation insurance premium in Nepal is said to be one among the highest in the world? Why is it so high?</strong></p>
<p style="text-align: justify;">
	Yes. As I already said, insurance premiums are based on the past losses. Because of the crashes, the premium has been rising. The recent crashes of Sita Air and Agni Air were a serious concern for the reinsurers.&nbsp;</p>
<p style="text-align: justify;">
	<strong>Are those high premium rates justifiable?&nbsp;</strong></p>
<p style="text-align: justify;">
	The loss is calculated based on the coverage offered by the insurance companies. Suppose there is a loss. You pay some percent of the loss. You pay for the hull losses and the machinery parts or you pay for the passenger liabilities. Passenger liability losses are much higher than the hull losses depending on the kind of passengers. The liability losses are much higher if the passengers are from the US or Canada, and lower if they are from the SAARC countries. The liability losses vary from people to people because of theirs living standard. While finalizing the rates, reinsurers study these things.&nbsp;</p>
<p style="text-align: justify;">
	Airliners not only fly Nepali people or SAARC people but also other foreigners. For example, most of the people in the mountain flights are from European countries. Furthermore, airliners have different premiums depending on their types, aircraft, and management facilities they have.&nbsp;</p>
<p style="text-align: justify;">
	<strong>How can we lower the high insurance premium?</strong></p>
<p style="text-align: justify;">
	It’s a million dollar question. It has to be high, otherwise it won’t be viable. We are not totally dependent on our own companies. We may not have the capacity, so we need to approach other markets for reinsurance. When the losses start decreasing, the premiums will simultaneously come down. For example in India, the fire premium rate was very high in the past. Many studies were conducted. And when they calculated the total premium over a period of time, and how much profit they generated- then the premium started coming down. Likewise, though the premium is high at the moment, it will definitely go down every year if the risk is reduced. In the present scenario, you don’t have any choice. Until the reinsurer accepts the business, how can you reinsure?</p>
<p style="text-align: justify;">
	<strong>The country’s first-ever aviation insurance summit was organized in the capital recently. How helpful was this summit?</strong></p>
<p style="text-align: justify;">
	I think it was helpful. We got to know the perspectives of different reinsurers present there. It was the first of its kind event in Nepal and was helpful for everyone involved in the aviation industry.&nbsp;</p>',
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			'description' => 'We have high retention capacity. We re-insure the portion to other reinsurance companies that is beyond our financial strengths.',
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		'Article' => array(
			'id' => '868',
			'article_category_id' => '40',
			'title' => 'Unhealthy Competition Among The Insurance Companies Should Be Stopped',
			'sub_title' => '',
			'summary' => null,
			'content' => '<p>
	<span style="color:#23c8fa;"><span style="font-size: 16px;"><strong>‘Unhealthy competition among the insurance companies should be stopped’</strong></span></span></p>
<p>
	<strong><img align="right" alt="Prem Bahadur Maharjan, Rastriya Beema Sansthan" height="307" src="http://www.newbusinessage.com/ckfinder/userfiles/Images/prem_cover_story_feb2013.jpg" style="margin:0 0 0 10px;" width="250" /></strong></p>
<address style="text-align: right;">
	<strong>Prem Bahadur Maharjan&nbsp;</strong></address>
<address style="text-align: right;">
	<strong>Chairman</strong></address>
<address style="text-align: right;">
	<strong>Rastriya Beema Sansthan</strong></address>
<div>
	 </div>
<p style="text-align: justify;">
	<strong>What is your company’s stake in the aviation insurance market?</strong></p>
<p style="text-align: justify;">
	The amount of insurance is calculated in foreign currency. We own around USD 2 million business which constitutes 30 to 40 per cent of the total aviation insurance business. We are the only insurance company insuring big aircraft including jet planes. We have insured the Jet planes of the national flag carrier, Nepal Airlines, and BB Airways lately. We have succeeded in acquiring the largest proportion of insurance share in the market because national airlines is insured with us. &nbsp;&nbsp;</p>
<p style="text-align: justify;">
	<strong>Is it true that the insurance companies have not been able to make profits from aviation insurance? Why?</strong></p>
<p style="text-align: justify;">
	I don’t agree with this. &nbsp;In our case, we feel that there is some harsh competition including in the premium rates. And particularly in the private airlines sector, we have witnessed a number of air crashes. That might have contributed to the loss in the overall aviation insurance business but it is not the case of Beema Sansthan. We have not gone through such loss. Nor &nbsp;have our clients faced such air crashes.&nbsp;</p>
<p style="text-align: justify;">
	<strong>Some insurance companies are trying to form a pool to collectively handle the claims on aviation insurance. When could we see such a pool?</strong></p>
<p style="text-align: justify;">
	I have also heard about it. I guess the practice of collectively handling the aviation insurance claims is yet to materialize. It would be good if such a pool is formed. It will help prevent unhealthy competition.&nbsp;</p>
<p style="text-align: justify;">
	<strong>What future do you see for aviation insurance business in Nepal?</strong></p>
<p style="text-align: justify;">
	I see a lot of potential for this business. &nbsp;The aviation market has grown in Nepal over the years and with it, the aviation insurance business, too, has grown. The other big reason is that Nepal is promoting tourism by organizing many events. This has increased the number of air passengers to Nepal and thus helped the aviation insurance in the country.&nbsp;</p>
<p style="text-align: justify;">
	<strong>Almost whatever the insurance companies earn from the aviation segment goes to the reinsurance companies abroad. Some are even said to be making losses in the aviation segment. It is said that the companies know that they are not going to make profits from the aviation segment. But they do aviation insurance just to show high insurance premium collection. What do you say?</strong></p>
<p style="text-align: justify;">
	In a way, it is true. Since we don’t have a strong financial institution that can cover the aviation insurance, we depend on foreign reinsurance companies. Though the percentage of commission from premium collection that we collect seems minimal, we are able to sustain the operation. Though the commission might be less in comparison to the bigger amount of insurance premium; we have other indirect benefits as well. It is because we have to reinsure &nbsp;with very reliable reinsurance companies recognized internationally. There are very few reliable reinsurance companies. Beema Sansthan has found a re-insurer based in the United Kingdom.&nbsp;</p>
<p style="text-align: justify;">
	<strong>What do you expect from the Beema Samiti or the government for that matter to facilitate the aviation insurance business in the country? &nbsp;</strong></p>
<p style="text-align: justify;">
	There is unhealthy competition among the insurance companies at present. They tend to take the aviation insurance business at low rates ignoring the risk factors. The situation is such that some companies might collapse if something bad happens to the airlines they have insured. Moreover, I have heard that some insurance companies are even unable to pay out the claims. Beema Samiti, being the regulatory body, can set some standards to avoid such kind of unhealthy competition. Beema Sansthan is a government-owned institution. So, it does not need to jump into this unhealthy competition. Though aviation insurance is growing, almost all the premium collected here goes abroad. We get only a fraction of it as commissions. I think this is the time that Beema Samiti should form a government-owned re-insurance company in Nepal. It will help us to stop or decrease the amount of money going outside the country.&nbsp;</p>
<p style="text-align: justify;">
	<strong>What are the key challenges and issues facing the aviation insurance industry in Nepal?</strong></p>
<p style="text-align: justify;">
	As I already mentioned, the first challenge is unhealthy competition among some insurance companies. The risk factor is also growing and it is making premiums costlier. We have witnessed many air crashes in a quite short period of time. It is not only about insurance, it is also about the safety of the people.&nbsp;</p>
<p style="text-align: justify;">
	<strong>What needs to be done to address these challenges?</strong></p>
<p style="text-align: justify;">
	There has to be a strict monitoring mechanism for air traffic discipline. People involved in the aviation business should be given safety education. Pilots should also be alerted not to take any sort of risks.&nbsp;</p>
<p style="text-align: justify;">
	Moreover, unhealthy competition among the insurance companies should be stopped. And it could be managed since there are very limited insurance companies in the aviation sector. Furthermore, the government should try to establish reinsurance companies here in Nepal itself.</p>
<p style="text-align: justify;">
	<strong>The country’s first-ever aviation insurance summit was organized in the capital recently. How did you find this summit?</strong></p>
<p style="text-align: justify;">
	From educational point of view, the summit was quite fruitful to the people involved in the aviation insurance sector. It was successful in raising the issues related to the risk factors in the aviation insurance and about the premiums that are in practice. Such summits are helpful in making people aware about the things happening in the aviation insurance market. I expect such events to continue.&nbsp;</p>',
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			'description' => 'The first challenge is unhealthy competition among some insurance companies.The risk factor is also growing and it is making premiums costlier.',
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			'id' => '867',
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			'title' => 'Airclaims Is A Major Resource For Nepali Civil Aviation',
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			'summary' => null,
			'content' => '<address>
	<strong style="text-align: right;"><font color="#23c8fa" size="3"><span style="font-style: normal;">‘Airclaims is a major resource for Nepali civil aviation’</span></font></strong></address>
<address>
	<strong style="text-align: right;"><font color="#23c8fa" size="3"><span style="font-style: normal;"><br />
	</span></font></strong></address>
<address>
	<strong>Douglas G Cavannagh</strong></address>
<address>
	<strong>Risk and Safety Manager</strong></address>
<address>
	<strong>Airclaims&nbsp;</strong><strong>(A UK-based leading reinsurance company)</strong></address>
<p style="text-align: justify;">
	<strong><br />
	</strong></p>
<p style="text-align: justify;">
	<strong>How long has your company been involved in the insurance business in Nepal?&nbsp;</strong></p>
<p style="text-align: justify;">
	Airclaims is the leading provider of claims, risk management and asset management services to the global aviation industry. Founded in 1964 Airclaims has been handling aviation insurance claims in Nepal since the late 1960s. Airclaims currently handles in excess of 2500 assignments each year though a global network of 20 offices. Airclaims is the leading provider of such expertise worldwide.&nbsp;</p>
<p style="text-align: justify;">
	In terms of Airclaims risk and safety consulting services this service offering was initially utilised by aviation insurance underwriters to assess the risk profile of different operators. The initiation of these studies was often a consequence of a serious accident or a deteriorating loss record on the part of an operator.&nbsp;</p>
<p style="text-align: justify;">
	As our capability grew these services were expanded to include risk and safety assessments of maintenance, repair and overhaul facilities, helicopter operators, ground handling companies and airports. During the past 20 years many of these services have also been utilised by petroleum and mining companies who use our expertise to assess the risk of different contractors that they use. Airclaims is now one of the leading providers of operator risk assessments in this sector. Our experience is often in demand from investors who require a bespoke due diligence study to assist them to better understand the risks associated with a potential acquisition and to provide valuations and condition surveys of aircraft to potential purchasers or those who wish to update the value of their aviation assets. We also undertake a considerable amount of work for airlines and operators who require a completely impartial assessment of their operation and a worldwide perspective to help them improve their own internal safety capability. This ranges from the initial assessment and needs analysis, to project management, training, coaching and final assessment.&nbsp;</p>
<p style="text-align: justify;">
	In today’s challenging asset management environment, the demand is for a business partner that not only has a strong reputation and broad capability but also the consistency of approach.&nbsp;</p>
<p style="text-align: justify;">
	Our integration of what are typically considered separate functions, such as project management, airworthiness oversight, powerplant services and risk management are all combined to form ten core modules, providing a unique capability&nbsp;</p>
<p style="text-align: justify;">
	<strong>How do you differentiate yourself from other companies?</strong></p>
<p style="text-align: justify;">
	We differentiate ourselves by:&nbsp;</p>
<ul>
	<li style="text-align: justify;">
		Drawing on ‘real world’ experience gained from our involvement in the aftermath of many of the largest aviation accidents and losses during the past 50 years.&nbsp;</li>
	<li style="text-align: justify;">
		Being able to recommend bespoke solutions to mitigate risk based on our work with all the different parties involved in aviation, not just airlines and operators.&nbsp;</li>
	<li style="text-align: justify;">
		Using our international experience gained from working with many different nationalities and cultures, to train and coach organisations on how to achieve the same objectives using alternative methods.&nbsp;</li>
	<li style="text-align: justify;">
		Using our exposure to accident sites and our knowledge of emergency response services to tailor procedures to the reality of what actually happens during these events.&nbsp;</li>
</ul>
<p style="text-align: justify;">
	<strong>The size of your business in Nepal at present?&nbsp;</strong></p>
<p style="text-align: justify;">
	That really depends on how often there is an accident. Unfortunately for some that has been a little too often. If there was to be a reduction in the number of accidents as a result of Airclaims providing Risk Management rather than Claims Management Services then that would be fine with us too. We are currently the preferred aviation claims handling company for the national airline and a number of domestic operators in Nepal and also most International carriers who operate services to Kathmandu. Our presence in Nepal over many decades has enable Airclaims to build up much valued relationships.&nbsp;</p>
<p style="text-align: justify;">
	<strong>Why is the insurance premium in aviation so high in Nepal?&nbsp;</strong></p>
<p style="text-align: justify;">
	There are a number of factors that affect the rate at which the insurance premium is calculated in any market. Some of those factors are loss record, operating environment and the type and value of the aircraft being insured.&nbsp;</p>
<p style="text-align: justify;">
	Nepal is undoubtedly a challenging operating environment for operators and crews in terms of terrain, weather and infrastructure and these factors do mean that along with a loss record that reflects these challenges, insurance costs will be higher. However, with improvements in infrastructure, training and operations, it is quite possible to address many of these factors and in doing so ensure that the cost of insurance is maintained at a reasonable level.&nbsp;</p>
<p style="text-align: justify;">
	There is also the factor of insurance market capacity something which cannot be directly influenced in Nepal. Worldwide, it could be said that there is a good deal of capacity i.e. insurers who want to underwrite aviation risks. Capacity and competition help keep the price down although, Nepal is seen as a higher risk region because of the factors already mentioned above.&nbsp;</p>
<p style="text-align: justify;">
	We know that all parties involved in aviation in Nepal are keen to support the improvements that are needed to ensure risk is reduced and Airclaims are ready to play its part in the provision of not just loss management services but also risk management services.&nbsp;</p>
<p style="text-align: justify;">
	<strong>What are the challenges faced by the aviation insurance business in Nepal?&nbsp;</strong></p>
<p style="text-align: justify;">
	The challengers faced by the aviation insurance business in Nepal are the challenges that face the aviation operators as well. The biggest challenge is to reduce operational risk. Despite the significant challenges that are faced, Nepal is clearly serious in its desire to reduce risk and consequently improve safety. It can be done.&nbsp;</p>
<p style="text-align: justify;">
	The main challenges facing aviation in Nepal are:&nbsp;</p>
<ul>
	<li style="text-align: justify;">
		Infrastructure improvement. There needs to be a significant investment in better basic airport facilities (i.e. runways, navigation aids, etc.)&nbsp;</li>
	<li style="text-align: justify;">
		Weather reporting. There is a requirement for a significant number of automatic weather stations to report the weather being experienced in real time, via satellite link, in the more remote parts of the country.&nbsp;</li>
	<li style="text-align: justify;">
		Better operational control being exercised by the operators. It needs to become a complete team effort especially when difficult decisions are needed associated with dispatch of aircraft in the difficult operational environment that exists.&nbsp;This will become even more important over the next decade or so as the average age and experience levels of pilots are reduced.&nbsp;</li>
	<li style="text-align: justify;">
		More and better training to help reduce the effect of the loss of highly experienced pilots over the next ten years.&nbsp;</li>
</ul>
<p style="text-align: justify;">
	<strong>What can Nepal do to overcome these challenges?&nbsp;</strong></p>
<p style="text-align: justify;">
	The system of regulation that has been in place for the past 50 plus years may have reached its maximum effectiveness. Regulation by requiring compliance with rules and regulations has probably got as good as it will get globally. The adoption of a more proactive and predictive Safety Management System (SMS) is needed by the operators and aviation authorities in Nepal. Having an effective way of safety oversight such as through adoption of a Safety Management System (SMS) has been proved to improve safety and risk management culture. Such a system can be used to support airline owners, airline managers, pilots &amp; engineers and all who are involved in aviation; this includes the regulators who must have a key role in supporting new ways of looking at risk and safety management and oversight.&nbsp;</p>
<p style="text-align: justify;">
	<strong>The annual claims payout in the aviation section has been constantly rising. This is bound to further increase the already significantly high aviation insurance premium. How are we going to tackle this problem?&nbsp;</strong></p>
<p style="text-align: justify;">
	The current global picture is interesting with record low levels of claims for successive years. Unfortunately this trend has not been seen in Nepal. Tackling the problem will require leadership on the part of the regulating authorities towards resetting the scene for risk and safety management such as through improvement in the operational management operators. The regulating authorities can and need to play a leading role in improving oversight and ensuring that all operators are able to take advantage of an open and even handed approach to improvement of infrastructure and operational standards. Operators investing in good safety systems and management should be supported and those that are failing to do this need to be provided with proper advice and if necessary some forms of sanction up to and including withdrawal of AOC.&nbsp;</p>
<p style="text-align: justify;">
	New approaches and thinking will bring positive benefits. We can’t just keep doing business as we have always done and expect things to get better on their own. Change is inevitable in all businesses not least aviation and the benefits to Nepal can be significant in terms of social and economic reward.&nbsp;</p>
<p style="text-align: justify;">
	<strong>What prospects do you see for aviation insurance business in Nepal in the future?&nbsp;</strong></p>
<p style="text-align: justify;">
	The prospects for aviation insurance business in Nepal are bright. There is a capable and knowledgeable local market which has good relationships with the global insurance community. The present level of risk is too high but there are enough insurers willing to support the market, albeit currently at a higher cost than in some other places. What is perceived as the current high cost of insurance can and should be reduced for operators who demonstrate a good safety culture and record, adopt a Safety Management Programme that is working well and can prove that it is making a difference.&nbsp;</p>
<p style="text-align: justify;">
	<strong>Is there anything else that you would like to say?&nbsp;</strong></p>
<p style="text-align: justify;">
	As a leading provider of Claims Handling and Risk and Asset Management Services and with our long association with Nepal aviation, Airclaims can help make a safer environment for all stakeholders in aviation in Nepal, but it has a cost. Therefore, we are ready to work with the leaders of aviation in Nepal to support Nepal in the development of its aviation capability and ambitions with safety as the focus of any plan. Once it happens all of Nepalese society will reap the benefits.&nbsp;</p>',
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			'id' => '866',
			'article_category_id' => '40',
			'title' => 'Sky Is The Limit For Aviation Insurance In Nepal',
			'sub_title' => '',
			'summary' => null,
			'content' => '<p style="text-align: justify;">
	<img align="right" alt="Prakash Panday, Shikhar Insurance Company Ltd" height="276" src="http://www.newbusinessage.com/ckfinder/userfiles/Images/prakash_panday_cover_feb2013.jpg" style="margin: 0px 0px 0px 10px;" width="235" /></p>
<address style="text-align: right;">
	<strong style="color: rgb(35, 200, 250); font-size: 16px; font-style: normal;">‘Sky is the limit for aviation insurance in Nepal’</strong></address>
<address style="text-align: right;">
	 </address>
<address style="text-align: right;">
	<strong>Dip Prakash Panday</strong></address>
<address style="text-align: right;">
	<strong>CEO</strong></address>
<address style="text-align: right;">
	<strong>Shikhar Insurance Company Ltd</strong></address>
<p>
	 </p>
<p style="text-align: justify;">
	<strong>What is the size of the aviation insurance market in Nepal?</strong></p>
<p style="text-align: justify;">
	The total size of the aviation insurance market of the domestic private sector in Nepal is around USD 8.5 -9 million.&nbsp;</p>
<p style="text-align: justify;">
	<strong>What about your company’s stake in the market?</strong></p>
<p style="text-align: justify;">
	We have around 70-75% market share.</p>
<p style="text-align: justify;">
	<strong>Is it true that the insurance companies have not been able to make profits from the aviation insurance? Why?</strong></p>
<p style="text-align: justify;">
	Aviation Insurance in Nepal has been a loss making portfolio for all the insurers involved. &nbsp;This has been because of the losses in the last couple of years. Nepal is being taken as a high risk zone for aviation insurance.&nbsp;</p>
<p style="text-align: justify;">
	<strong>It is said that some insurance companies are trying to form a pool to collectively handle the aviation insurance claims. What is the latest progress in this regard?</strong></p>
<p style="text-align: justify;">
	It is a very good concept. Reinsurance companies support about 99.5 per cent insurance and only 0.5% is handled by the local insurance companies. The main idea behind forming this pool is to take the advantage of the volume and also to get quality reinsurers so that losses get paid in a timely manner and also to have standardization in all the policies. &nbsp;This can also help in some investment in safety features.&nbsp;</p>
<p style="text-align: justify;">
	<strong>How is this pool going to help the insurance companies, if and when it is formed?</strong></p>
<p style="text-align: justify;">
	It is still in the planning process. Insurance companies and operators have to come together with full support from the regulators before such a pool can be formed. &nbsp;</p>
<p style="text-align: justify;">
	<strong>What future do you see for aviation insurance business in Nepal?</strong></p>
<p style="text-align: justify;">
	Sky is the limit for aviation insurance in Nepal. The only thing is that safety factors have to be improved. Nepal’s aviation sector is classified as the highest risk zone for reinsurers. We want to see Nepal as a safe destination. When a pool of insurers is going to own the overall aviation insurance, more responsibility shall be felt. Risk management is very important.&nbsp;</p>
<p style="text-align: justify;">
	<strong>Almost whatever the insurance companies earn from the aviation segment goes to the reinsurance companies abroad. Some are even said to be making losses in the aviation segment. It is said that the companies know that they are not going to make profits from the aviation segment. But they do aviation insurance just to show high insurance premium collection is. What do you say?</strong></p>
<p style="text-align: justify;">
	We are not sending money, we are transferring risk. The reason that the companies are still in profit is because the money is flowing in from the reinsurers abroad. Since they agreed to take the risk, they bear the losses as well. But after eight consecutive years of losses, they are getting scared. Some of the reinsurers have already withdrawn from the Nepali aviation market.</p>
<p style="text-align: justify;">
	<strong>How can we lower the high insurance premium?</strong></p>
<p style="text-align: justify;">
	It will take time. It is important to win the confidence of the reinsurers and prove that Nepal’s aviation sector is a safe zone for investment. This can be done only by reducing the losses. Fear is a very dangerous thing. Our terrains are difficult, which has sent a wrong perception. Similarly, loss is also a perception and this can be changed. All we need is 2 to 3 years of good loss ratio.&nbsp;</p>
<p style="text-align: justify;">
	<strong>What do you expect from the Beema Samiti or the government for that matter to facilitate the aviation insurance business in the country? &nbsp;</strong></p>
<p style="text-align: justify;">
	It would be great if the Beema Samiti would help in the process of making an Aviation Pool. Active participation and support is required from them and the Civil Aviation Authority of Nepal (CAAN), especially on the safety side. This should not be only on papers but also in practice.&nbsp;</p>
<p style="text-align: justify;">
	<strong>What are the key challenges and issues facing the aviation insurance industry in Nepal?</strong></p>
<p style="text-align: justify;">
	CAAN has to take the lead role. CAAN and the private airline operators should be more alert. There should be an improvement in monitoring flight data, safety infrastructure etc. For example, many airports in Nepal are not black-topped. When the weather is bad, flights should be aborted and airports should be closed. Individual behavior should be monitored by the operators. We also need to invest in training and skill development of the people involved in the aviation business.&nbsp;</p>
<p style="text-align: justify;">
	<strong>The annual claims payout in the aviation section has been constantly rising. This is bound to further increase the already significantly high aviation insurance premium. How are we going to tackle this problem?</strong></p>
<p style="text-align: justify;">
	There should be a considerable investment in safety measures. I feel that the only way out now is to produce good results for the reinsurers. Losses do happen but the frequency of losses in our country is high. If we go jointly, I feel that this will be a good beginning and we can produce significant results. &nbsp;</p>
<p style="text-align: justify;">
	<strong>There are various types of aviation insurance policies in the world. Are all of them available in Nepal?</strong></p>
<p style="text-align: justify;">
	Three basic types of aviation products are available in Nepal. These are basically for Hull, Liability including Passengers and Crew Personnel Accident and Hull War. Hull insurance covers the insurance of aircraft. Till last year, Combined Single Limit Liability insurance required was USD 60 million per aircraft which has now been revised. Hull War insurance is used in case of war, hijacking etc. &nbsp;</p>
<p style="text-align: justify;">
	<strong>The country’s first-ever aviation insurance summit was organized in the capital recently. How helpful was this summit?</strong></p>
<p style="text-align: justify;">
	Reinsurers came to the market and studied it. Their perception has changed. We took them to see our infrastructures including a mountain flight and had discussions on the current issues of the aviation market. We are trying our best to boost the reinsurers’ confidence. We feel that the summit has helped to bring some positive change in their risk perception of our country.</p>
<div style="text-align: justify;">
	 </div>',
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			'description' => 'The reason that the companies are still in profit is because the money is inflowing from the reinsurers abroad. Since they agreed to take the risk, they bear the losses as well.',
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	(int) 8 => array(
		'Article' => array(
			'id' => '865',
			'article_category_id' => '39',
			'title' => 'NICL : Three Decades Of Insurance',
			'sub_title' => '',
			'summary' => null,
			'content' => '<p>
	<img alt="National Insurance Company Limited (NICL)" height="60" src="http://www.newbusinessage.com/ckfinder/userfiles/Images/corporate_focus_feb2013.jpg" style="text-align: justify;" width="210" /></p>
<p style="text-align: justify;">
	National Insurance Company Limited (NICL) is a Government of India Undertaking and is operating in Nepal since 1973. NICL completed 106 years on 6th December 2012 and is into the 107th year of operation. Prior to nationalisation in India in 1972, it was operating as a private company. In 1972, at the time of nationalisation of Non Life Insurance Sector in India, there were 106 companies operating in India and later on, 22 Foreign and 11 Indian private companies were merged to form National Insurance Company Limited.</p>
<p style="text-align: justify;">
	National Insurance Company Limited (NICL) had hardly any competitions at the time of establishment, three decades back in Nepal. Now the company is facing a cut throat competition from 17 non life insurance companies in the Nepali market.&nbsp;</p>
<p style="text-align: justify;">
	The stiff competition does not deter the company from having its strong foothold in the market. NICL believes and enjoys working on a competitive environment. “We welcome competition in the insurance field. We strongly feel that competition is must to ensure prompt services to clients and it is good for the customers as they can look forward to better services,” said Dr Pronab Sen, Chief Executive Officer (CEO) of the company’s Nepal operations. However, the competition is mostly in the service front since most of the portfolios are tariff products and the rates are fixed by the regulators, so the competition is almost none on the premium rate front.</p>
<p style="text-align: justify;">
	<strong>Market Potentials</strong></p>
<p style="text-align: justify;">
	Though the competition has heightened much, insurance business has not been able to penetrate deep enough into the insurance market. Sen said that the penetration level is just 0.55 per cent. Therefore, the company sees huge untapped market potentials available.&nbsp;</p>
<p style="text-align: justify;">
	“I strongly feel that the non life insurance business can be increased many folds in Nepal as the awareness level is very low and we need to create insurance awareness among masses,” said Sen. Even though the Nepali insurance market has seen many players for the last three decades, still the awareness level lies low. The insurance market has not developed much during this time span. Sen feels that there is a need to recruit agents, who can propagate the message of insurance among the masses and make people understand the need of insurance. He believes that this could be the means to create indirect employment.</p>
<p style="text-align: justify;">
	Amid the competitive environment, the NICL has come up by leaps and bounds. Dr Sen said, “We have grown many folds in terms of business, manpower and networking.”</p>
<p style="text-align: justify;">
	<span style="font-size:14px;"><strong><img align="right" alt="Pronab Sen, National Insurance Company Limited" height="184" src="http://www.newbusinessage.com/ckfinder/userfiles/Images/corporate_focus_feb2013_pronab.jpg" style="margin:0 0 0 10px;" width="150" /><br />
	</strong></span></p>
<p style="text-align: justify;">
	<span style="font-size:14px;"><strong>‘We strongly feel that competition is must to ensure prompt services to clients and it is good for the customers as they can look forward to better services.’</strong></span></p>
<p>
	<span _fck_bookmark="1" style="display: none;">&nbsp;</span></p>
<address>
	Dr Pronab Sen</address>
<address>
	CEO, Nepal Operations</address>
<address>
	National Insurance Company Ltd</address>
<p>
	<span _fck_bookmark="1" style="display: none;">&nbsp;</span></p>
<p style="text-align: justify;">
	<strong>Market Presence</strong></p>
<p style="text-align: justify;">
	Currently the NICL has six branch offices - three in Kathmandu and one each in Birganj, Biratnagar and Nepalganj. &nbsp;Sen said that the company has Beema &nbsp;Sewa &nbsp;Kendras &nbsp;in Hetauda and Janakpur. “Apart from this, we also have representatives based in Dhangadi, Dharan, Narayangarh, Simara and Birtamod with the controlling office in Kathmandu,” he explained.&nbsp;</p>
<p style="text-align: justify;">
	NICL has planned to expand its network to cities like Pokhara and Bhairahawa and upgrade the Beema Sewa Kendras to Sub Branch. Sen said that with a service oriented motive the NICL has some ambitious plans on a customer centric ground. Similarly the company is planning to organise insurance awareness programmes for the clients along with publicity and brand image.</p>
<p style="text-align: justify;">
	<strong>Products and Services</strong></p>
<p style="text-align: justify;">
	Being a non life insurance company, NICL offers wide range of products ranging from Motor, Fire, Personal Line policies like Sweet Home, Personal Accident, Health Insurance, Liability, and Aviation among others. According to Sen, the company has cattle and livestock and crop policy in its pipeline as the Insurance Board has already issued directives for the same.&nbsp;</p>
<p style="text-align: justify;">
	To ensure prompt services, the NLIC has centralised its claims processing and started a Centralized Claims Processing Hub in Kathmandu, with the sole idea of reducing the Turn Around Time (TAT) in claim processing, according to Sen. “On experimental basis, we have also started paying claims through Electronic Clearing Service (ECS) and in the initial stage, we are restricting it to the corporate clients and based on the results, we will initiate this system for all claims,” he revealed. Employee’s salary, surveyors payment and agency commission payment is being done through ECS as an experiment.</p>
<p style="text-align: justify;">
	<strong>Human Resources</strong></p>
<p style="text-align: justify;">
	The company has 76 employees as of now. &nbsp;The company believes that its employees are its most valuable assets. NICL gives value to the team work and the spirit of working in unity. Sen shared, “We are continuously trying to upgrade the soft skills of our team members with the motto “Grow Profitably” i.e. ensure top line as well as bottom line growth and feel proud to be an NICian.”</p>
<p style="text-align: justify;">
	He said that the company is continuously involved in developing the soft skills of its employees so that they can perform better and make the team more sensitive to customer’s needs and deliver results in time.&nbsp;</p>
<p style="text-align: justify;">
	Though having its parent company in India, NICL has just two expats from India and rest of its manpower is from Nepal itself. “Our recruitments are restricted to Nepali citizens only,” said Sen.</p>
<p style="text-align: justify;">
	However, one of the biggest challenges the company is facing at the moment is getting skilled manpower in insurance domain. To resolve this issue the NICL organises in-house training to its people.</p>
<p style="text-align: justify;">
	<strong><img align="left" alt="National Insurance Company Limited" height="314" src="http://www.newbusinessage.com/ckfinder/userfiles/Images/corporate_focus_feb2013_financial_highlights.jpg" style="margin:0 10px 0 0;" width="282" />Management Mantra</strong></p>
<p style="text-align: justify;">
	The NICL believes in maintaining the transparency and good corporate governance to its best. Sen explained, “Our management’s commitment is to maintain transparent working and remain committed to compliance of tariff and guidelines of the regulator and law of land.” The company has been able to maintain a cordial relationship with the regulator – Insurance Board of Nepal - in its operation history and strictly abide by all the rules and regulations issued by the regulator.&nbsp;</p>
<p style="text-align: justify;">
	Managing claims is probably one of the challenging jobs at an insurance company. To handle the sensitive issue, the company is concentrating on improving claims services and reducing TAT for claims settlement. Sen believes, being a part of the service sector, the overall business depends on the quality of the services offered. “Now we have a process in place, to depute surveyors immediately on receipt of the claim irrespective of the fact whether it is a holiday or a working day,” he said, “To complete the formalities to enable us to settle client’s claims at the earliest possible.”</p>
<p style="text-align: justify;">
	<strong>CSR Activities</strong></p>
<p style="text-align: justify;">
	Beginning from the 107th Foundation day on 6th December 2012, the NICL has initiated the CSR activities in Nepal. As a part of the CSR activities, the company distributed 107 blankets and rechargeable torches to poor elderly people and orphan children. NICL also organised a health check up camp and blood donation camp on 6th January 2013, which was attended by the NICL employees, clients and surveyors apart from general public. The company plans to plant 107 saplings shortly along with numerous other CSR plans in the pipeline.</p>
<p style="text-align: justify;">
	Similarly, the company is also the Gold Sponsor of Walkathon organised by Standard Chartered Bank every year for helping restoration of eyesight of visually impaired and to help the HIV infected persons in Nepal.</p>
<div>
	<img alt="National Insurance Company Limited" height="563" src="http://www.newbusinessage.com/ckfinder/userfiles/Images/corporate_focus_feb2013_swot.jpg" width="277" /></div>
<p>
	 </p>',
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			'description' => 'Though the competition has heightened much, insurance business has not been able to penetrate deep enough into the insurance market.',
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	(int) 9 => array(
		'Article' => array(
			'id' => '864',
			'article_category_id' => '38',
			'title' => 'Three “R”s For  Startup Businesses',
			'sub_title' => '',
			'summary' => null,
			'content' => '<p style="text-align: justify;">
	<span style="text-align: justify;">Businesses are hard to predict. There is a saying “God laughs at those who plan the future”. This applies both to life and to businesses, especially the ones that are just starting. Pukar Shah, a returnee from the UK, has recently started a business of planting Aloe Vera in his own ancestral land that was mostly going to waste due to shortage of trusted labourers. He believes that Nepal can improve its status only by making large investments in the agriculture sector. While the rest of the world has reached far away from the time of doing agriculture, 80 per cent of Nepal‘s population still relies on nature for a living. &nbsp;This is not only a culture but also a big natural advantage to Nepal. Nepal can grow everything that grows in between 8000 m to 60 m above sea level. While the richest country of the world, the US, with its organization USAID is investing in Nepal’s agriculture with projects like FTF (Feed the Future) and Health for Life (H4L), it is an opportunity to respond. Plus, according to Pukar, it is a risk-free business because he already has a line of buyers who want to buy his produce.&nbsp;</span></p>
<p style="text-align: justify;">
	Harvard Business School Professor Noam Wasserman has outlined &nbsp;three Rs for the people wanting to start up their own business. In his article, Wasserman lists them as “Three Pitfalls Startup Founders must avoid”. These are the relationship decisions, roles decisions, and rewards decisions. According to Prof Wasserman, while starting a new business, there’s a strong temptation to make decisions for the short term. But you need to anticipate the long-term challenges. It is very critical to get at least three things right. They are:&nbsp;</p>
<p style="text-align: justify;">
	<strong>Co-founders:</strong> The natural inclination is to co-find with family or friends. But these relationships can be fraught. Plus you’re more likely to have similar perspectives. Look for partners who bring complementary skills and assets.&nbsp;</p>
<p style="text-align: justify;">
	<strong>Roles:</strong> Most founders want a C-level title. After all, they were there from the start. But choose roles that reflect the actual work each founder will do, not the fancy title he wants to show off.&nbsp;</p>
<p style="text-align: justify;">
	<strong>Rewards: </strong>One of the biggest questions for start-ups is how to split the equity ownership. A handshake on 50/50 will not do because almost all new companies will have a major change in strategy or founder involvement. Negotiate an arrangement that can change when the circumstances do.</p>
<div style="padding:10px; background:#f4f3e6;">
	<p>
		<strong><span style="font-size:14px;">Naming the Company</span></strong></p>
	<p style="text-align: justify;">
		Together with the ideas, management and operation planning, NAME for the Startup Organization also makes a considerable difference. What’s in a name? Well judging from the long list of businesses that a simple Google search can yield when you search “naming your company”, there are plenty. While deciding on a name, don’t take the decision lightly. Not only is your company’s name a critical part of your overall identity, but it will also be used on any of your marketing products, PR, blogs, websites and publications. Given below are five naming strategies that have been successful globally.&nbsp;</p>
	<p>
		<strong>Real Words</strong></p>
	<p style="text-align: justify;">
		When you consider, Apple, Yahoo, Indeed and Amazon, they mean something but often they have no immediate relation to their business.&nbsp;</p>
	<p style="text-align: justify;">
		<strong>Misspelled Words</strong></p>
	<p style="text-align: justify;">
		No, this isn’t an insult of your intelligence. We know that you know how to spell, but using phonetics rather than grammar may give you that cool edge you need. Consider some of these well known examples; Tumblr (Tumbler), Del.icio.us (Delicious), Digg (Dig) and Flickr (Flicker).&nbsp;</p>
	<p style="text-align: justify;">
		<strong>Two Syllable, Compound Words</strong></p>
	<p style="text-align: justify;">
		There are plenty of new companies moving in this direction. Among some of the most popular, there’s BirchBox, SkillShare, CrowdTilt and JackThreads. This could possibly have something to do with the success of FaceBook.&nbsp;</p>
	<p style="text-align: justify;">
		<strong>Initials and Acronyms</strong></p>
	<p style="text-align: justify;">
		Think about going old school, such as IBM (International Business Machines), AOL (America Online) and TBS (Turner Broadcast System). You’re not alone. Reportedly, Rupert Murdoch is considering changing the name of The Wall Street Journal to simply “WSJ”.&nbsp;</p>
	<p style="text-align: justify;">
		<strong>Made-Up Words</strong></p>
	<p style="text-align: justify;">
		Skype, Hulu and Zynga are all made up words. But if you’re successful, you most likely won’t find yourself in any trademark grudge matches in the future.&nbsp;</p>
	<p style="text-align: right;">
		<span style="font-size:11px;">(Source: compiled from various sources)</span></p>
</div>
<p>
	 </p>
<p style="text-align: justify;">
	Pukar, in his startup business, has successfully implemented all these strategies. He happens to follow this idea from his uncle who has been involved in this sector for over 20 years now. Pukar is confident that his uncle’s expertise and his knowledge in proper management of the company will help him succeed in the long run in this sector. Pukar is not obsessed with the CEO title. He has chosen the role of managing the production process and looking after the financials while his uncle handles the marketing department. He had set up an initial agreement of 50 per cent &nbsp;investment and 50 per cent &nbsp;returns with his uncle. But according to him, he currently owns only 35 per cent of the return and the overall organization has four shareholders from two in just a matter of a year. He believes that one cannot have a fixed agreement in business; instead, one needs to go with the flow.</p>
<p style="text-align: justify;">
	Also, it is very crucial to understand the cash flow before starting a business. More than a third of new businesses fail in the first three years and it’s rarely because of a bad business concept; it’s almost always the result of running out of cash. As well as having working capital to cover early stage losses, it’s imperative that you collect your invoices on the due date. If you don’t, you are providing working capital to your customers and unless you are running a bank, you can’t afford to do this. According to Pukar, if cash is the king for a successful business, it’s the emperor for a start-up. &nbsp;</p>
<p style="text-align: justify;">
	<img align="left" alt="Management February 2013" height="259" src="http://www.newbusinessage.com/ckfinder/userfiles/Images/management_feb2013(4).jpg" style="margin:0 10px 0 0;" width="250" />For Pukar, there was no problem of having insufficient resources and capital for giving a shape to his idea, but most of us who want to start a business do not have the resources and capital. Not only in Nepal but also in most of the developed countries in the world, there are angel investors. Angels typically invest their own funds, unlike venture capitalists, who manage the pooled money of others in a professionally-managed fund. Angel investments bear extremely high risk and are usually subject to dilution from future investment rounds. As such, they require a very high return on investment. A large percentage of angel investments are lost completely when early stage companies fail. Therefore,, professional angel investors seek investments that have the potential to return at least 10 or more times their original investment within five years through a defined exit strategy such as plans for an initial public offering or an acquisition. The Silicon Valley of the United States of America, also known as the home to many of the world’s largest technology corporations as well as thousands of small startups, was funded by the Angel investors from the beginning. A Harvard report by William R Kerr, Josh Lerner and Antoinette Scholar provides evidence that angel-funded startup companies have historically been less likely to fail than companies that rely on other forms of initial financing.</p>',
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			'description' => 'While starting a new business, there’s a strong temptation to make decisions for the short term. But you need to anticipate the long-term challenges.More than a third of new businesses fail in the first three years and it’s rarely because of a bad business concept; it’s almost always the result of running out of cash.',
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			'id' => '863',
			'article_category_id' => '38',
			'title' => 'Is Shakespeare Relevant In Today’s Commercial World?',
			'sub_title' => '',
			'summary' => null,
			'content' => '<p>
	<strong style="text-align: justify;">By Sujit Mundul</strong></p>
<p style="text-align: justify;">
	There have been lots of debates and discussions on the relevance of Shakespeare’s heroes as leaders in the modern commercial world. On this widely debated subject, a great deal of work had happened in the Oxford University under the leadership of Richard Oliver.</p>
<p style="text-align: justify;">
	I have had the good fortune to interact with Richard many times on the issues of leadership, seeking his guidance. It is increasingly common to hear nowadays that we are facing a crisis of leadership. The ways in which organizations are moving forward can no longer be comprehended through the same models, language and logical analysis that have served leaders in the past.</p>
<p style="text-align: justify;">
	I could strongly agree with Richard that the time has come when businesses actually need what the arts have to offer in order to survive. We can draw a good deal of similarity between the commercial world and the arts, in that both the streams, apparently poles apart, need creativity, imagination, flexibility, adaptability, effective communication and visionary tendencies for survival as well as &nbsp;domination in the respective fields.</p>
<p style="text-align: justify;">
	Stories have been used to inspire and instruct us human beings since we learnt to speak.</p>
<p style="text-align: justify;">
	Let us take a look at Shakespeare’s stories. Henry V is the story from which we can glean the most about the nature of inspiration. From the first line that calls to our imagination with its plea for “a muse of fire”, to the last scene where Henry, as a Victorian leader, struggles to turn a battlefield into a garden, the plot, to my reckoning, reflects invaluable insights into leadership.</p>
<p style="text-align: justify;">
	Henry V unites a group of disparate people (his nobles) around a common goal (in this instance, reclaiming the territory of France) and manages to overcome all difficulties in his path to achieve a near miraculous victory against the odds (i.e. winning the Battle of Agincourt).</p>
<p style="text-align: justify;">
	So, readers are encouraged to see the King as an inspired leader, the nation as an organization, the nobles as the senior management team, and France as a big project. &nbsp;I am sure that once we start thinking along these lines, we can very well find the relevance of Shakespeare’s characters in today’s changing world. Shakespeare survives gracefully through the changing fads of every generation because he touches so consistently on the truth of human experience.</p>
<p style="text-align: justify;">
	Henry V takes over as King after the sudden demise of his father, the late King.But people can’t believe that Henry, who has the reputation of a spoiled brat, would allow Lord Chief Justice (a hard critic of Henry) to continue in the same position as also to become his mentor. In addition Henry promises to call Parliament. His journey begins.</p>
<p style="text-align: justify;">
	In Act 1 we see Henry meets with his nobles to gather support for achieving his mission to reclaim the territory of France. He gets their consent. Henry has sent a message to the King of France asking if he will give up his throne. The French ambassador arrives with an answer; a trunk which Henry assumes will be full of jewels in an attempt to buy him off. Instead, it is full of tennis balls sent by the French Prince with an accompanying message that Henry better stick to the trivial pursuits he is capable of winning like tennis. Henry gives the ambassador a right –royal telling off and sends him out. Finally, he makes a firm commitment to pursue his mission to France.</p>
<div>
	<img alt="Management February 2013" height="234" src="http://www.newbusinessage.com/ckfinder/userfiles/Images/management_feb2013(2).jpg" width="580" /></div>
<div>
	<div style="text-align: justify;">
		In commercial life, when we start our first project as a leader, we need to seek sound advice and believe in the “right” to go ahead. This “right” is granted internally and externally. Internally we can use a “line of service” to draw strength from. But we need certain amount of political intelligence to win the external right, to prepare our nobles (senior management) to take a risk and follow us into new territories. And we will have to make a demonstrable and visible commitment to pursue the project. If people think we are not totally behind this, the project may fail. Henry did follow all these steps.</div>
	<div style="text-align: justify;">
		 </div>
	<div style="text-align: justify;">
		In Act 2 Henry gathers and allocates his available resources and identifies and deals with those who oppose the mission (and the traitors) before it has even started.</div>
	<div style="text-align: justify;">
		 </div>
	<div style="text-align: justify;">
		In all major projects, leaders should be able to identify the forces ranged for and against them. Many a times, a good leader has to be a good actor. He may need to hide certain knowledge from certain people at certain times. He may need to disguise intentions, particularly while attempting to identify those who disagreed with the agreed mission and who may oppose its desired outcome. It is important to identify them correctly and deal with them appropriately for ensuring success of the project.</div>
	<div style="text-align: justify;">
		 </div>
	<div style="text-align: justify;">
		In Act 3, Henry starts with a reasonable plan: arrive in August with 10,000 troops, take the first foothold in a week and march on to Paris by Christmas. He lands at the coastal town of Harfleur as planned but three months later, he is still there having lost 2000 men. He makes a rousing speech to his exhausted troops. An effective leader will have to speak passionately and imaginatively to motivate them through the blocks. The next attack seems to make a difference, for the Governor of Harfleur asks for a peace party. Henry speaks and warns that if the town is not surrendered now; he will be unable to control his troop’s anger. Then when they do succeed, the town will be destroyed and people killed. The Governor surrenders the town. Henry insists that all the inhabitants be treated mercifully. He changes strategy and decides to withdraw to Calais (an English territory at that time) where his troops can rest over winter.&nbsp;</div>
	<div style="text-align: justify;">
		 </div>
	<div style="text-align: justify;">
		Throughout the play, Henry demonstrates the wonderful leadership quality of painting pictures of the future. Here he uses it to paint such a negative view of the future that the Governor gives in rather than risk that picture becoming reality. He does not press on to his initial goal regardless; he revises his strategy on the ground. Nor does he admit failure and simply retreat to England. He finds a third way; a strategic withdrawal.</div>
	<div style="text-align: justify;">
		 </div>
	<div style="text-align: justify;">
		The French army is chasing Henry’s exhausted 8000 walking men with 40,000 fresh mounted troops. Inevitably they catch up and surround the English on the field of Agincourt. The French Herald is sent in to offer Henry a simple choice; give in now (and pay a huge fine but Henry and all his troops leave), or fight tomorrow and die. Henry says he does not seek a battle at the moment; he wishes to march to Calais, but if challenged he will fight. The French prepare for battle.</div>
	<div style="text-align: justify;">
		<strong><span style="font-size:16px;"><br />
		</span></strong></div>
	<div style="text-align: justify;">
		<strong><span style="font-size:16px;">Managers have to solve problems. Leaders have to solve dilemmas, complex issues with no happy solutions. When leaders meet the real test, they will require to call on all their skills to hold a line that will give their people enough confidence to carry on</span></strong>. Act 4 shows Henry going through the long dark night before the battle, facing up to his fears and duties before being able to inspire his troops to an apparently miraculous victory against the odds.</div>
	<div style="text-align: justify;">
		 </div>
	<div style="text-align: justify;">
		Henry cannot really want to be out talking to his troops at 3 o’clock in the night. But he does it because it is required of him. He exercises visible leadership which is seen by others thus bolstering their confidence.</div>
	<div style="text-align: justify;">
		 </div>
	<div style="text-align: justify;">
		Leaders need to allow themselves to enter “the dark night of the soul” and face their own innermost fears, doubts and uncertainties, especially in a crisis, and particularly before they make decisions that affect the lives of others. If they don’t, they may make wrong decisions for the wrong reasons. There is a point in most meaningful projects when the leaders are forced to ask themselves: “Is this the right thing to do? And are we the right persons to do it?” In these times they will have to manage their own fears and the fears of others simultaneously but differently.</div>
	<div style="text-align: justify;">
		 </div>
	<div style="text-align: justify;">
		Henry is courageous enough to listen to what the troops really think. But if he listens carefully to what they are thinking, he may just be able to inspire them later. However, he also feels the weight of responsibility that they put on him. He needs to unload this or he may make his decision on what others want rather than what he thinks is right. When Henry arrives back at his tent, he overhears the nobles wishing for more troops. He speaks to them from the heart, telling them why he personally believes they are doing the right thing. He says they are enough to win honorably or die trying. He says those that do not wish to fight can leave. But any that chose to fight and survive will remember this day for the rest of their lives. They go off to start the battle.</div>
	<div style="text-align: justify;">
		 </div>
	<div style="text-align: justify;">
		The whole process of surviving the “Dark Night” has served to strip away layers to reveal Henry’s center, his core values - what he is doing all this for. Mind you, it is from this core that he speaks to inspire others.</div>
	<div style="text-align: justify;">
		The battle is going well for the English. They deal with the first wave of French attack and capture many prisoners. Another attack is sounded. Henry orders his men to kill the prisoners. Meanwhile the French have raided the luggage tents and killed all the boys who were guarding them. The Herald enters and tells Henry the day is his. He thanks God and forbids everyone to boast of the victory. They set off for Calais.</div>
	<div style="text-align: justify;">
		 </div>
	<div style="text-align: justify;">
		Most leaders wish they could get through their career without having to take any tough decision. Very few get their wish. There is usually a situation where we are forced to compromise the values on which we prided ourselves when we started our journey to leadership. It is the ability to take these hard decisions and live with the consequences that separates “the men from the boys” amongst the leaders.</div>
	<div style="text-align: justify;">
		 </div>
	<div style="text-align: justify;">
		In Act 5 Henry is encouraged to make peace and turn the battlefield into a garden. He attempts to court Princess Katherine (daughter of the French King) but realizes he has much to learn about building relationships before the political necessity becomes a heartfelt reality.</div>
	<div style="text-align: justify;">
		 </div>
	<div style="text-align: justify;">
		Katherine agrees to the marriage but Henry can tell she does not yet love him. He understands that he has to change his approach and learn a new way of life.</div>
	<div style="text-align: justify;">
		 </div>
	<div style="text-align: justify;">
		Many leaders have got where they are because of their ability to fight and win. Sometimes though, this is not enough. &nbsp;We may have to nurture the new territory we have achieved rather than look for the next target.</div>
	<div style="text-align: justify;">
		 </div>
	<div style="text-align: justify;">
		To my mind, Shakespeare’s relevance in the modern complex world of commerce holds good adequately. Nevertheless, I leave it to the readers to decide on this enunciation, as they feel apposite.</div>
	<div>
		 </div>
	<div>
		<strong>Mundul is a Director with Standard Chartered Bank Nepal Ltd.</strong></div>
</div>',
			'published' => true,
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			'keywords' => '',
			'description' => 'Shakespeare survives gracefully through the changing fads 
of every generation because he touches so consistently on 
the truth of human experience.',
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		'Article' => array(
			'id' => '862',
			'article_category_id' => '37',
			'title' => 'Global Economy Outlook  For 2013: Figures & Beyond!',
			'sub_title' => '',
			'summary' => null,
			'content' => '<p style="text-align: justify;">
	<strong>By Sandip Nepal</strong></p>
<p style="text-align: justify;">
	The year 2012 remained gloomy for the entire seven billion plus world population in terms of economic growth and prosperity. With world economic leaders like the USA, Eurozone and China not acquiring the ‘expected status’ for the year, i.e. 2012, amidst spiking issues like unemployment, inflation and debt crisis regimes, prospects for 2013 do not look encouraging at this point of time.</p>
<p style="text-align: justify;">
	Concerned over the ongoing austerity measures, high unemployment rate and lower business confidence combined with weak market sentiments in core global economies like the USA and Eurozone, the World Bank (WB) has lowered its forecast for 2013. Market analysts and global institutions, pioneering in economic forecasts, are coming up with new lowered growth forecasts for the current year in line with lower than expected manufacturing and trade indicators coming from both sides of the Atlantic. The world economy was initially expected to grow by 3 percent in 2013. However, the new growth forecast based on the current and prospect scenario has come out to be 2.4 per cent, lowered by 60 basis points from the initial forecast.&nbsp;</p>
<p style="text-align: justify;">
	Similarly, amidst reduced global growth, market analysts and economists from around the world have lowered their growth forecast for the ‘land of the rising sun,’ i.e., Japan, US and the more vigilant economy, the Eurozone. It is believed that the second year of contraction in the Eurozone will have a tremendous impact on the global economy and could act as a reverse-catalyst in the global economic atmosphere, measured by Global Purchasing Managers’ Index or any other global index. Having inter-twined relationship with economic superpowers &nbsp;such as China, Eurozone and the US, emerging economies like India, Brazil, Mexico and other East-Asian economies fear that they cannot remain unaffected by the contraction in the economic environment of the world’s economic hubs. However, developing economies from around the globe are expected to expand at the rate of above 5.5 per cent in 2013.</p>
<p style="text-align: justify;">
	The World Bank has already warned against the fragility and vulnerability of the global economy in the remaining months of 2013. On the other hand, the report has also emphasized that the magnitude of economic downside will be at decreasing rate compared to recent precursor years. If we turn back and scrutinize 2012, European measures, reforms and policies to cushion the financial/debt crisis in the single economic bloc have not been able to provide economic surge or even correction to the ongoing recession. At a time when financial and political agendas have not been facilitating economic improvement in the single currency bloc, issues related to spending cuts and tax hikes in the US, diplomatic tensions between Japan and China affecting trade environment, and ‘not so good’ manufacturing and industrial indicators coming from the US and China are feared to cloud whatever little optimism remains for &nbsp;the ongoing year.</p>
<p style="text-align: justify;">
	<strong>Global Economic Growth Forecast for 2013</strong></p>
<p>
	<strong><img align="left" alt="Economy and policy February 2013" height="230" src="http://www.newbusinessage.com/ckfinder/userfiles/Images/economy_policy_feb2013.jpg" style="margin: 0 10px 0 0; " width="250" /></strong></p>
<p style="text-align: justify;">
	Considering the gloom in the world economic regimes in 2012 and the grayish ongoing global economic performance, the US in 2013 is forecasted to grow by 1.9 per cent. With political tensions mounting between two core Asian economies, Japan and China, amid affected Japanese trade in automobiles and related industries, and with contraction in one of the largest export sectors, the Japanese economy is expected to witness a meager growth of only 0.7 per cent in 2013. Unlike the economies mentioned above, the Chinese economy with its improving manufacturing sector, satisfactory flow of Foreign Direct Investment and export data has been projected to grow by an attractive 8.4 per cent in 2013, though the figure is 20 basis points lower than the previous projection for the year. Further, increasing Chinese appetite for FDI outflow also exhibits the magnitude of its economy. Moving on to emerging economies, the growth rates for India, Brazil and Mexico have been projected to be 6.1, 3.4 and 3.3 percent, respectively. With economies like the Eurozone and the USA not really supporting these emerging economies, these expected growth rates could be deemed satisfactory.</p>
<p style="text-align: justify;">
	<strong>Nepali Economy in 2013 and Global Influence</strong></p>
<p style="text-align: justify;">
	Nepali exports have seen a decline in recent months, thanks to the economic slowdown in the Euro Area and a mild US economy. Nepali industries like, garment, herbs, handicraft, carpet, metal-wood and other related sectors are hit hard by the global meltdown. Combined with the international pessimism, ‘below-par’ agricultural and industrial performance is also contributing to drag the economy towards austerity. In line with the current and forecasted economic indicators, the WB has forecasted Nepal’s economic growth rate to be 3.8 per cent for fiscal year 2012-13, which is 80 basis points lower than the actual economic growth rate for fiscal year 2011-12.</p>
<p style="text-align: justify;">
	The key issues contributing to lowered growth forecast could be attributed to the ongoing constitutional crisis, poor investment environment (in terms of FDirectI) and infrastructural bottlenecks in the country. Besides the ongoing political instability and poor market sentiments, inadequate and inefficient public expenditure, too, has been hampering the economic outlook, which, in turn, may further contribute to downgrading the current forecasted growth rate. Remittance, working as a key source of financing, incorporates around 22 per cent of the national Gross Domestic Product (GDP). At this point of economic junction, as remittance has been facilitating to finance imports, covering trade deficits with counterparts, the year ahead could also see an optimistic inflow of funds, taking into account the numbers of Nepalis working abroad, especially in the Gulf countries.</p>
<p style="text-align: justify;">
	With the WB having already lowering Nepal’s growth forecast for fiscal year 2012-13 and remittance acting as an economic catalyst, it’s political leaders and government authorities who could possibly look into the matter and plug the loopholes in the operating environment, eventually facilitating, promoting and simplifying investment grounds for national and international market participants. Only time would tell what the government would do to address the situation and improve the country’s GDP growth rate, lower dependency on remittance and international debts for the year and henceforth.</p>
<p style="text-align: justify;">
	<strong>The author is Assistant Manager, Research &amp; Development Department, Mercantile Exchange Nepal Limited, Nepal.</strong></p>',
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			'description' => 'Concerned over the ongoing austerity measures, high unemployment rate and lower business confidence combined with weak market sentiments in core global economies like the USA and Eurozone, the World Bank (WB) has lowered its forecast for 2013.',
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	(int) 12 => array(
		'Article' => array(
			'id' => '860',
			'article_category_id' => '31',
			'title' => 'Visiting Business People: February 2013',
			'sub_title' => '',
			'summary' => null,
			'content' => '<p>
	<strong><span style="font-size:16px;">‘We help people make good change take root’</span></strong></p>
<p>
	<img align="right" alt="Bill Stockton" height="286" src="http://www.newbusinessage.com/ckfinder/userfiles/Images/bill_stockton_visiting_business_people(1).jpg" style="margin:5px 0 10px 10px;" width="250" /><strong> </strong></p>
<p style="text-align: justify;">
	<span style="color:#f00;">Bill Stockton</span> is a Senior Advisor of the Verghis Group, a management consulting firm.<span style="text-align: justify;">He is known as the ‘center of gravity’ for knowledge sharing practice and consulting within the financial sector including investment and retail banking and insurance companies in the Verghis Group. Stockton graduated in Psychology from the University of North Carolina at Chapel Hill. He served Deutsche Bank for 18 years, mainly in the IT department. &nbsp;He was the director and global head of support and operations for over 20 products including foreign exchange, equities, programme trading, cash management and more. Most recently, he was tapped by Deutsche Bank to institute a global knowledge sharing programme that trained over 3200 IT staff and demonstrated productivity gains. In an interview with Nubiz recently when he was in Kathmandu, Stockton shared the importance and need of knowledge sharing and knowledge management in any organization.&nbsp;</span></p>
<p>
	<strong><strong>Excerpts:&nbsp;</strong></strong></p>
<p style="text-align: justify;">
	<strong><strong>What are your recent engagements?</strong></strong></p>
<p style="text-align: justify;">
	I left Deutsche Bank as a Director and as an IT Manager. I left because I think I can do much more, particularly in the area of knowledge sharing in finance companies. We have three small companies in the Verghis Group. We can resolve things primarily on knowledge sharing and knowledge management. Also, we do a quite a lot of work on measures, metrics and madness which is about stopping measuring activities and reassuring for outcome. We do also have a research wing which conducts very exciting research, mostly on behaviour psychology- the kind of research we primarily conduct.&nbsp;</p>
<p style="text-align: justify;">
	<strong><strong>What brings you to Nepal?</strong></strong></p>
<p style="text-align: justify;">
	My ancestors had been coming to Nepal for a long time. We did not come here for business. We came here because we are interested in all the things we have heard about Nepal.&nbsp;</p>
<p style="text-align: justify;">
	<But my partner, Christina, has come here several times a year for the past ten years. &nbsp;Her visits are mainly aimed at supporting organizations like Sano Paila in Birgunj and other women’s groups for social service. Professionally, she is a doctor in psychology and has done quite a lot of work in areas like peace negotiation and conflict management. She is also from the leadership training which is mostly about working with people who don’t usually talk together productively. So, I joined her on a number of those session conducted here.&nbsp;</p>
<p style="text-align: justify;">
	>There are some really exciting possibilities in my mind about knowledge sharing. Many people don’t know what knowledge sharing or knowledge management is. A number of companies need knowledge management. Research show whether it be Deutsche Bank, Mega Bank or Coca-Cola - around 60-90 percent problem is solved by somebody else in the organization. So, knowledge management is about the behaviour and practices required to make that knowledge available to anyone who needs it in the organization.&nbsp;</p>
<p style="text-align: justify;">
	What I see is, when you get a really good idea you don’t want anyone else to know that idea. You try it just by yourself. But in today’s new Internet age, if you put your ideas right there, other people can come and collaborate. The more I share what I know, the more valuable I become. People have trouble doing that and they have also trouble believing that.&nbsp;</p>
<p style="text-align: justify;">
	<strong><strong>How does your strategy help other organizations?&nbsp;</strong></strong></p>
<p style="text-align: justify;">
	We teach companies how to capture the intellectual capital of the employees in all sorts of makeshift and inefficient repositories so that once a problem is solved, future occurrences of the same or similar problems will be prevented or resolved much faster.&nbsp;</p>
<p style="text-align: justify;">
	<strong><strong>What prospects do you see for your business in Nepal? &nbsp;</strong></strong></p>
<p style="text-align: justify;">
	These are universal problems faced by companies from Wall Street in New York to Kantipath in Kathmandu. We tailor our work to each customer not only to offer services at a good price but also to determine whether or not we think we can add value to our clients.</p>
<p style="text-align: justify;">
	<strong><strong>&nbsp;What are your plans?&nbsp;</strong></strong></p>
<p style="text-align: justify;">
	We have several research projects underway. These projects are about ensuring better client satisfaction during a tech support or services support call. We are also putting together an online site to help make organizational change stick. Change is so difficult to anchor and become “sticky”. We help people make good change take root while helping organizations and businesses prioritize and differentiate between doing the right things and doing things right.</p>',
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			'description' => 'Bill Stockton is known as the ‘center of gravity’ for knowledge sharing practice and consulting within the financial sector including investment and retail banking and insurance companies in the Verghis Group.',
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			'id' => '859',
			'article_category_id' => '60',
			'title' => 'Etihad’s New Daily Flights To Brisbane And Singapore',
			'sub_title' => '',
			'summary' => null,
			'content' => '<p>
	<img alt="Etihad Airways" height="229" src="http://www.newbusinessage.com/ckfinder/userfiles/Images/etihad_airways(1).jpg" width="500" /></p>
<p style="text-align: justify;">
	Etihad Airways, the national airline of the United Arab Emirates, has commenced its new schedule of daily flights between Abu Dhabi and Brisbane via Singapore this week (give the exact date). To mark the occasion, Etihad Airways operated ‘Blue Moon Rising’, its Airbus A330-200 painted in Manchester City Football Club colours on the commemorative February 1 flight. James Hogan, President and Chief Executive Officer of Etihad Airways, said that the new daily service would add an extra 1,048 seats a week to the Abu Dhabi-Singapore-Brisbane route. “The additional capacity puts Etihad Airways in a stronger than ever position in the Singapore and Australian markets. It enables us to compete on a more level playing field than in the past,” said Hogan. He also said that the airline was working closely with government and industry stakeholders in each market to ensure the route’s continuing success.&nbsp;</p>
<p style="text-align: justify;">
	Etihad Airways commenced three weekly flights to Brisbane and Singapore on September 28, 2007. The Queensland capital was the airline’s second destination in Australia and the 43rd in its global network. The airline operates its state-of the-art Airbus A330-200 aircraft on the Abu Dhabi- Singapore-Brisbane route. The aircraft is configured in two classes with 22 seats in Pearl Business Class and 240 seats in Coral Economy Class.&nbsp;</p>
<div style="text-align: justify;">
	 </div>',
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			'description' => 'Etihad Airways has commenced its new schedule of daily flights between Abu Dhabi and Brisbane via Singapore this week',
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			'title' => 'Oman Air’s Special Companion Scheme',
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			'content' => '<p>
	<img alt="Oman Air" height="152" src="http://www.newbusinessage.com/ckfinder/userfiles/Images/oman_air.jpg" width="150" /></p>
<p style="text-align: justify;">
	Oman Air is offering a Special Companion scheme for Business class for a period of 20 days from February 1 to 20.The airlines has informed that the travel can be completed by 31 May 2013. According to the airline, the customers can avail this offer by contacting their travel agents.</p>',
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			'keywords' => '',
			'description' => 'Oman Air is offering a Special Companion scheme for Business class for a period of 20 days from February 1 to 20.',
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			'title' => 'Beer Ads On Nepali Television? Why Not?',
			'sub_title' => '',
			'summary' => null,
			'content' => '<p>
	<strong style="text-align: justify;">By Abhaya Panday</strong></p>
<p style="text-align: justify;">
	<img alt="Advertising, February 2013" height="190" src="http://www.newbusinessage.com/ckfinder/userfiles/Images/advertising_feb2013.jpg" width="350" /></p>
<p style="text-align: justify;">
	One fine day in 1999 AD, the then His Majesty’s Government decided to ban beer ads on the television. Media reports suggest that it was done under the recommendations of the WHO, the organization which holds immense influence over a poor country like ours. The fact that the same ‘world body’ becomes powerless about the beer ads in countries like the USA is another story altogether. Rumours following the ban also suggested that the decision was made at the behest of a business house which enjoyed monopoly in the country’s beer market. Banning the beer ads on TV would have made it an uphill task for new entrants to increase their market share and thus that ban would have been in the interest of the market leader.&nbsp;</p>
<p style="text-align: justify;">
	But whatever the reasons, apparent or underlying, that is irrelevant. What is important is to question the basis on which the government of the day chose to impose the ban. And why did the party in power, which brands its ideology as the most scientific and revolutionary, choose to continue the legacy of the ‘old regime’? Had the ‘old regime’ conducted a reliable scientific research on the effects of beer ads on its consumption? Let’s forget about a reliable and scientific research for a moment. Did the government conduct any research at all? Nothing suggests that it did. The decision was arbitrary and arbitrariness has become the founding principle of the state in relation to advertising. The latest example of this arbitrariness is the recent decision of one-door policy for government ads.&nbsp;</p>
<p style="text-align: justify;">
	Does the Ministry of Information and Communications (MoIC) possess more expertise in appropriating government ads than the other ministries? Evidence of arbitrariness was seen in the recent past when the Insurance Board decided to curb the spending of insurance companies on their promotional activities, thus negatively affecting the advertising industry. Sometime back, the TV commercial I had made for Digital Cable TV was banned by the MoIC without any clear cut policy on comparative advertising and in the absence of an independent and competent regulatory body on advertising. These are just a few examples which highlight the attitude of the state towards advertising. &nbsp;</p>
<p style="text-align: justify;">
	Let me get back to the ban on beer ads on television. Was it necessary to impose the ban? I don’t think so. Because the assumption that beer advertising results in the increase of overall consumption is unfounded. First, the objective of any advertising exercise is to influence purchase decisions, not to increase the overall consumption. Moreover, in a product category like alcohol that is already widely consumed- in one form or the other- increasing the overall consumption of alcohol is an objective unworthy of pursuit for an advertiser. From the viewer’s perspective, does watching beer ads on TV help the drinker consume more beer than he/she normally does? Or does it entice a non-drinker to have a pint or more? Is advertising the ‘cause’ or the ‘effect’ of alcohol consumption? If the government believes that advertising is the ‘cause’ then perhaps it overestimates the power of advertising. In that case, the government should let the advertising agencies run the nation and by the sheer power of advertising, they shall eradicate all the evils of society. The fact that commercial advertising is mostly the reflection of the society’s values and aspirations and not the cause puts the power of advertising in the proper perspective.&nbsp;</p>
<p style="text-align: justify;">
	Whether beer ads actually increase the overall consumption is an issue that has been raised in the US Parliament more than once. In response, the Federal Trade Commission, The Department of Health and a Senate subcommittee have submitted their reports on different occasions. And their findings suggest a clear absence of correlation between beer advertising and beer consumption. A 21-year long study conducted by Texas University also corroborates the findings. And let’s not forget that we are discussing a country whose per capita alcohol consumption is four times more than that of ours. Some countries in Europe have the figures six times as much, yet beer advertising enjoys considerable freedom in those countries. Of course, the content and placement of beer advertising is regulated and that is what we should be doing in Nepal. Lift the ban on beer advertising on TV and regulate the content and placement. Ironically, the government ignored to impose the ban in the print media, probably under the impression that print advertising is less effective than TV advertising.&nbsp;</p>
<p style="text-align: justify;">
	Is beer drinking good or bad for health? Is moderate drinking medically acceptable or even beneficial? These are medical issues that should be addressed by the medical and health experts. Why do people begin consuming alcohol and, when they do, why do some turn alcoholics? Will we become a better society if we impose a total ban on alcohol? These are different issues altogether. I am neither a medical expert nor a sociologist and nor a psychologist. But as an advertiser, I am led to believe, on the basis of various scientific research conducted in countries where credible scientific &nbsp;research are produced, that advertising of beer on TV does not promote its overall consumption.&nbsp;</p>
<p style="text-align: justify;">
	Advertising, in this view, can only influence the choice of the brand. You may choose to drink beer A instead of beer B, having been influenced by the advertisement of A. But it is most unlikely that you will drink more than what the context allows or, as a non-drinker, you will decide to drink beer A without the psychological need. If the government wants to reduce the consumption of beer or alcohol, then it must address the issues surrounding the psychological and social needs that lead to the consumption of beer or alcoholic products in general. Necessity is not only the mother of invention but also consumption. &nbsp;Kill the enemy, if you can. Don’t kill the messenger.&nbsp;</p>
<p style="text-align: justify;">
	<span style="font-size:11px;">The writer is an advertising professional.</span></p>',
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the founding principle of the state in relation to advertising.',
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	(int) 1 => array(
		'Article' => array(
			'id' => '872',
			'article_category_id' => '40',
			'title' => 'The Pooling Mechanism Is To Stabilize The Insurance Market',
			'sub_title' => '',
			'summary' => null,
			'content' => '<p>
	<strong style="color: rgb(35, 200, 250); font-size: 16px; text-align: right;">‘The pooling mechanism is to stabilize the insurance market’</strong></p>
<p>
	<strong><img align="right" alt="Mahendra Shrestha, Himalayan General Insurance" height="301" src="http://www.newbusinessage.com/ckfinder/userfiles/Images/mahendra_cover_feb2013.jpg" style="margin:0 0 0 10px;" width="250" /></strong></p>
<address style="text-align: right;">
	<strong>Mahendra Shrestha</strong></address>
<address style="text-align: right;">
	<strong>Managing Director</strong></address>
<address style="text-align: right;">
	<strong>Himalayan General Insurance</strong></address>
<p style="text-align: justify;">
	 </p>
<p style="text-align: justify;">
	<strong>What is your company’s stake in the aviation insurance market?</strong></p>
<p style="text-align: justify;">
	Himalayan General has been writing aviation insurance since 1998 and it is a portfolio we continue to be interested in.</p>
<p style="text-align: justify;">
	<strong>It is said that some insurance companies are trying to form a pool to collectively handle the aviation insurance claims. What is the latest progress in this regard?</strong></p>
<p style="text-align: justify;">
	Preliminary discussions have been initiated for the formation of aviation insurance pool. The formation of such a pool will not only allow insurance companies to gain capacity but also make it viable for the re-insurers to continue supporting Nepal’s aviation insurance market.</p>
<p style="text-align: justify;">
	<strong>What future do you see for the aviation insurance business in Nepal?</strong></p>
<p style="text-align: justify;">
	It is a portfolio which is an absolute necessity in Nepal and one that will continue to grow.</p>
<p style="text-align: justify;">
	<strong>Aviation insurance premium in Nepal is said to be one among the highest in the world? Why is it so high? How can we lower it?</strong></p>
<p style="text-align: justify;">
	Aviation insurance premium in Nepal is certainly very high. Some big losses in the last few years have pushed up the premium rates substantially. The continually rising premium rates are, of course, a serious concern because they impact the sustainability of the business. The pooling mechanism is one of the possibilities we are exploring in order to stabilize the market. Eventually, if the total premium paid is more than the total amount claimed in losses, we hope the premium will start to come down.</p>
<p style="text-align: justify;">
	What are the key challenges and issues facing the aviation insurance industry in Nepal and what needs to be done to address these challenges?</p>
<p style="text-align: justify;">
	Rising premium rates and shrinking market capacity are two major challenges the aviation insurance industry is currently facing. The Aviation Insurance Summit was one way to address these challenges and find a common direction for improvement and growth.</p>
<p style="text-align: justify;">
	<strong>The country’s first-ever aviation insurance summit was organized in the capital recently. How helpful was this summit?</strong></p>
<p style="text-align: justify;">
	The Summit brought local stakeholders, including operators, regulatory bodies, insurance companies and banks as well as key players in the regional and global aviation insurance industry (including underwriters and re-insurance brokers) under one roof. It gave the Nepali stakeholders a global perspective on our current situation as well as access to the expertise of visiting delegates, all of whom have extensive experience in this sector, including in other countries with contexts similar to Nepal.</p>
<p style="text-align: justify;">
	All the delegates who attended the Summit said that they had found it to be a helpful introduction to the Nepal aviation insurance market, adding that it will help them take better decisions for supporting it.</p>',
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			'description' => 'The continually rising premium rate is a serious concern because they impact the sustainability of the business. The pooling mechanism is one of the possibilities we are exploring in order to stabilize the market.',
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	(int) 2 => array(
		'Article' => array(
			'id' => '871',
			'article_category_id' => '40',
			'title' => 'We Are More Aware About  The Safety Concerns Today Than In The Past',
			'sub_title' => '',
			'summary' => null,
			'content' => '<p>
	<strong style="color: rgb(35, 200, 250); font-size: 16px; text-align: right;">‘We are more aware about the safety concerns today than in the past’</strong></p>
<p>
	<img align="right" alt="Rameshwor Thapa, Airlines Operators Association of Nepal " height="314" src="http://www.newbusinessage.com/ckfinder/userfiles/Images/rameshwor_cover_feb2013.jpg" style="margin:0 0 0 10px;" width="250" /></p>
<address style="text-align: right;">
	<br />
	<strong>Rameshwor Thapa</strong></address>
<address style="text-align: right;">
	<strong>President&nbsp;</strong></address>
<address style="text-align: right;">
	<strong>Airlines Operators Association of Nepal (AOAN)</strong></address>
<p>
	<strong><br />
	</strong></p>
<p style="text-align: justify;">
	<strong>What is the size of the aviation insurance market in Nepal?</strong></p>
<p style="text-align: justify;">
	When talking about the insurance size, the Nepali aviation insurance business is small in global comparison. However, it has an addressable size in the context of the South Asian countries. That means the aviation insurance market in Nepal is neither big nor small but of medium size in terms of money as well as the number of insurers involved in this business. We now pay USD 8 to 9 million in premium to international companies annually.&nbsp;</p>
<p style="text-align: justify;">
	<strong>Why is the aviation insurance premium so high in Nepal? How can we lower it?</strong></p>
<p style="text-align: justify;">
	The re-occurrence of air crashes have contributed to the increment of aviation insurance premium. The open sky aviation policy has helped the mushrooming of airliners in Nepal while the infrastructure remains almost the same. And there may be many issues concerning safety issues. The dramatic increase in premium is also because of the climate and weather. Importantly, trunk route operators have fewer problems in comparison to the STOL (short takeoff and landing) route operators mainly because of the high hills and high altitude. In STOL, mainly in helicopters, there are many instances of accidents beyond what could be conconsidered as normal. &nbsp;</p>
<p style="text-align: justify;">
	Now there are more airports and other facilities which could be rated higher in safety. We are organizing many safety seminars and programmes to lower the premiums with the safety much assured. There have been programmes enhancing the safety measures and we are very much confident that we would be able to enhance safety measures. We are more aware about the safety concerns today than in the past. The audit reports by ICAO and other organizations have diversified it further and made it clear also. Aircraft and passenger safety should be the airliners’ main concern. If we maintain all this - for enhanced safety in the aviation sector - definitely the premium will come down.&nbsp;</p>
<p style="text-align: justify;">
	<strong>There have been more than 50 major accidents in the past 10 years. Why is the frequency of aerial accidents so high in Nepal?&nbsp;</strong></p>
<p style="text-align: justify;">
	It is very sad and bitter fact. The increasing premium in aviation insurance is making it difficult for the airline companies. These days we are trying to improve the security in the aviation sector and are not expecting such accidents again. We are working to reduce such accidents by organizing different seminars and programmes to enhance safety in the aviation sector. Through these safety seminars, we are being able to make the stakeholders aware about air safety. There, we make the pilots aware about focusing on safety while the stakeholders update themselves with different issues and activities in the aviation sector. All the people involved in this sector should understand that not compromising any safety measures but maintaining them will help mitigate the risks. Visual Flight Regulation (VFR) should not be allowed to go through the clouds. &nbsp;If we follow all these safety measures, definitely the risks have to go down. Civil Aviation Authority of Nepal (CAAN) should monitor these flights and instruct accordingly.&nbsp;</p>
<p style="text-align: justify;">
	<strong>The annual claims payout in the aviation insurance has been constantly rising. This is bound to further increase the already significantly high aviation insurance premium. How are we going to tackle this problem?</strong></p>
<p style="text-align: justify;">
	We are concerned about this problem. Basically, if we are able to enhance safety measures, it would help to lower the premium paid out to reinsurance companies. Most of the re-insurers are quite convinced that we would be able to maintain safety properly. End of the Maoist war has also spread positive message to the reinsurers. In the past, we had to pay US$ 60 million premium in third party liability though we owned small aircraft. After knowing the problem, Nepal government addressed this. And now we have to pay some 10 million dollars for the same. The thing is, once we fix the safety problem, the premium will come down.&nbsp;</p>
<p style="text-align: justify;">
	<strong>There are various types of aviation insurance policies in the world. Are all of them available in Nepal?</strong></p>
<p style="text-align: justify;">
	There are not various types of insurance policies in the aviation insurance. The available insurances are air-craft’s insurance, passenger’s insurance, cargo insurance, crew-members insurance- including others. There are insurance policies with same periphery and nature and are normally practiced in other countries as well. Now there are different types of reinsurance market but the problem is they take our situation as an alarming one. I think the situation is not that alarming. Some of the reinsurance companies really want to work and support the Nepali aviation sector which includes Indian as well as western reinsurance companies. A new aviation group in Malaysia is also interested in this business. Moreover the re-insurer companies are not of various types; they are of a singular nature and type.&nbsp;</p>
<p style="text-align: justify;">
	<strong>The country’s first-ever aviation insurance summit was organized in the capital recently. What’s your impression of the summit?&nbsp;</strong></p>
<p style="text-align: justify;">
	It was definitely helpful to us. I think the reinsurance companies that were finding threats in our sky are convinced that the premium which we are paying is not justifiable. We hope that in the coming days they won’t increase the premiums and won’t take our sky as an alarming one for aviation insurance. They got a chance to understand our aviation environment and we had a chance to put the reality in front of them. We were able to prove that there is neither any violence in the country nor any threat in the aviation sector. We were able to prove that we are quite committed to maintaining safety and that we are continuously working on it. We have learnt from past accidents and we are committed to avoiding such accidents.&nbsp;</p>',
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			'keywords' => '',
			'description' => 'Most of the re-insurers are quite convinced that we would be able to maintain safety properly. End of the Maoist war has also spread positive message to the re-insurers.',
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	(int) 3 => array(
		'Article' => array(
			'id' => '870',
			'article_category_id' => '40',
			'title' => 'Now Is The Challenge Of Getting Right Reinsurer At A Competitive Price',
			'sub_title' => '',
			'summary' => null,
			'content' => '<p>
	<strong style="color: rgb(35, 200, 250); font-size: 16px; text-align: right;">‘When the losses start decreasing, the premium will come down’</strong></p>
<p style="text-align: justify;">
	<strong><img align="right" alt="Kewal Krishna Shrestha, Everest Insurance" height="316" src="http://www.newbusinessage.com/ckfinder/userfiles/Images/kewal_cover_feb2013.jpg" style="margin: 0 0 0 10px;" width="250" /></strong></p>
<address style="text-align: right;">
	<strong>Kewal Krishna Shrestha&nbsp;</strong></address>
<address style="text-align: right;">
	<strong>President, Nepal Insurers Association &amp;</strong></address>
<address style="text-align: right;">
	<strong>CEO, Everest Insurance</strong></address>
<p style="text-align: justify;">
	<strong><br />
	</strong></p>
<p style="text-align: justify;">
	<strong>What is the size of the aviation insurance market in Nepal?</strong></p>
<p style="text-align: justify;">
	The market size is around Rs 420- 500 million in terms of the premium we collect from our clients.&nbsp;</p>
<p style="text-align: justify;">
	<strong>What about your company’s stake in the market?</strong></p>
<p style="text-align: justify;">
	We own around 25-30 per cent share in Nepal’s aviation insurance market.&nbsp;</p>
<p style="text-align: justify;">
	<strong>It is said that some insurance companies are trying to form a pool to collectively handle the claims on aviation insurance. Are you aware of the latest progress in this regard?</strong></p>
<p style="text-align: justify;">
	I don’t think the pool is what we need to improve the aviation insurance business. Now we are competing to get the lowest rate from reliable companies (reinsurers) but if such a pool is formed, there would be monopoly in the insurance market and there would be no competition. Insurance companies could syndicate the aviation insurance business and the situation could worsen further. The premium will be at a high rate and the airliners will raise the ticket price which in turn will make air travelling difficult. It seems beneficial to all of us but if we view it minutely it is only a means of syndicating that could affect the whole country economically. &nbsp;</p>
<p style="text-align: justify;">
	However, if such pool is sure to be formed we could form this pool in two ways. One, we can calculate certain risks in the aviation industry and other, we can focus on the risks involved in the hull, baggage etc. However creating such a pool needs lots of vision.&nbsp;</p>
<p style="text-align: justify;">
	Beema Samiti recently organized an interaction programme on the possibilities of merger between &nbsp;insurance companies. This interaction was a good initiation in the insurance business but I think both the government and Beema Samiti should be well prepared on it. It needs lots of homework and researches whether to form a pool or to merge the insurance companies.&nbsp;</p>
<p style="text-align: justify;">
	<strong>What future do you see for the aviation insurance business in Nepal?</strong></p>
<p style="text-align: justify;">
	The prospects of aviation business in Nepal depend on the growth of the airliners. The more airlines are there, the better for the aviation insurance business. The theory of demand and supply is applied in the aviation business also. Many airlines are not functioning well and some of them have registered but have not started their operation yet. If new airliners start operating it would benefit both the airliners and the aviation industry. &nbsp;Development of airports and runways in a sustainable way can also sustain airliners. And the development of airliners ultimately grows the aviation insurance business. Since there is a lot of prospects in the tourism sector, I see bright future of aviation insurance business.&nbsp;</p>
<p style="text-align: justify;">
	<strong>Aviation insurance premium in Nepal is said to be one among the highest in the world? Why is it so high?</strong></p>
<p style="text-align: justify;">
	No, I disagree with this. We used to pay 8-9 per cent premium some 10 years ago and we were able to reduce that as low as 2 per cent later. Now again the reinsurance companies are charging the same old rate or even higher. It is mainly because of the risk factors in the aviation industry of Nepal and I don’t think it is unjustifiable. The terrain, safety measures in the aviation industry in Nepal and lack of maintaining safety standards by all the stakeholders involved in the aviation industry are some of the reasons behind the increment of premium. We lack the standard safety measures in spite of ICAO advice.&nbsp;</p>
<p style="text-align: justify;">
	<strong>What do you expect from the Beema Samiti or the government for that matter to facilitate the aviation insurance business in the country? &nbsp;</strong></p>
<p style="text-align: justify;">
	The government can enforce the safety standards. It can properly manage the runways, ground handling, and certify efficiency of the people and the equipment used in the aircraft or for the aircraft maintenance. If you see how the baggage in airports is handled, you will find how improperly things are done. The baggage is loaded in tractors and the insurer has to pay if there is a damage. Furthermore, the international airport in Nepal is very crowded. I think the TIA should now be shifted to some convenient place.&nbsp;</p>
<p style="text-align: justify;">
	<strong>What are the key challenges and issues facing the aviation insurance industry in Nepal?</strong></p>
<p style="text-align: justify;">
	Now is the challenge of getting the right reinsurer at a competitive price. The aviation business is anyway running though the reinsurers are charging up to 12 per cent. But what if they charge 20-25 per cent? I don’t think aviation in Nepal could bear such high premium rates. Moreover, the environment could be such that even the high premium might not draw reinsurers into confidence. Because of the high risk involved in this business, the reinsurers could add more clauses which could affect the overall aviation business in Nepal. And then it will be hard to find reliable reinsurers and we will have to reinsure with whichever party we find. When the claim increases, the premium market becomes hard and reinsurers hesitate to do business. And aviation insurance is driven by reinsurers. Unless the scenario of this seller-driven market changes, we won’t have any other alternative.&nbsp;</p>
<p style="text-align: justify;">
	<strong>What needs to be done to address these challenges?</strong></p>
<p style="text-align: justify;">
	CAAN has to be strong. All the stakeholders of the aviation industry should maintain the safety standards prescribed by ICAO in terms of physical amenities, ground handling, aircraft maintenance, tracing of the aircraft personnel etc. Maintaining the safety standard is the foremost requirement. Everybody in the aviation industry should strictly follow the policies and run under rules and regulations of the government. &nbsp;</p>
<p style="text-align: justify;">
	<strong>The annual claims payout in the aviation section has been constantly rising. This is bound to further increase the already significantly high aviation insurance premium. How are we going to tackle this problem?</strong></p>
<p style="text-align: justify;">
	This is not a problem; it’s an outcome which is natural. When claims payout in the aviation sector starts increasing, increment in the premium is normal internationally. &nbsp;And when the claims start rising, the party is affected and slowly it affects other airliners. When the risk is found the reinsurer loads the premium and that is considered normal in the insurance business.&nbsp;</p>
<p style="text-align: justify;">
	When safety measures are properly followed the risk has to go down. For this, all the stakeholders in the aviation industry should come together and contribute. &nbsp;Evaluation of our work and adopting things that make this business ideal as well as searching ways of perfection in the aviation business is a must.&nbsp;</p>',
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			'description' => 'Now we are competing to get the lowest rate from reliable companies (reinsurers) but if such a pool is formed, there would be monopoly of the insurance companies and there would be no competition.',
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	(int) 4 => array(
		'Article' => array(
			'id' => '869',
			'article_category_id' => '40',
			'title' => 'When The Losses Start Decreasing, The Premium Will Come Down',
			'sub_title' => '',
			'summary' => null,
			'content' => '<p>
	<strong style="color: rgb(35, 200, 250); font-size: 16px; text-align: right;">‘When the losses start decreasing, the premium will come down’</strong></p>
<p>
	<img align="right" alt="Pronab Sen, National Insurance Company Ltd" height="317" src="http://www.newbusinessage.com/ckfinder/userfiles/Images/pronab_cover_feb2013.jpg" style="margin: 0 0 0 10px;" width="250" /></p>
<address style="text-align: right;">
	<strong>Dr Pronab Sen&nbsp;</strong></address>
<address style="text-align: right;">
	<strong>Chief Executive Officer,&nbsp;</strong></address>
<address style="text-align: right;">
	<strong>Nepal</strong><strong>National Insurance Company Ltd</strong></address>
<p>
	 </p>
<p style="text-align: justify;">
	<strong>What is your company’s stake in the aviation insurance portfolio?</strong></p>
<p style="text-align: justify;">
	We are moving very selectively in the aviation insurance in Nepal. Previously, Guna Air was 100 per cent with us and now Simrik Air has taken it over. There are some airliners which are having reinsurance support from our corporate office in India- like Buddha Air. We have around five percent market share in the aviation portfolio. Agni Air is co-insured with Shikhar Insurance – 60 percent with them and 40 per cent with us. Another airline in Pokhara has insured 49 per cent with us and 51 per cent with Shikhar. We are now negotiating with Simrik because Guna was with us. &nbsp;</p>
<p style="text-align: justify;">
	We are the direct branch of a reinsurance company in India governed by the Indian Government. We have high retention capacity. We reinsure the portion to other reinsurance companies that is beyond our financial strengths. This is a worldwide phenomenon in insurance business. It depends on portfolios and varies from risk to risk. Sometimes, we retain 20 per cent and sometimes 90- depending on the risks.</p>
<p style="text-align: justify;">
	<strong>Is it true that the insurance companies in Nepal have not been able to make profits from aviation insurance? Why?</strong></p>
<p style="text-align: justify;">
	Yes it is true. And the reason is there are a number of airliners which are very small in size. It may be also because of the weather and terrain of Nepal. Small airliners and aviation companies do not afford expertise and there are few airliners where I have seen the full expertise – this is the biggest challenges for the Nepali aviation sector. Many of the aircraft are also very old. &nbsp;</p>
<p style="text-align: justify;">
	Some of the insurance companies have retention capacity of 0.4 per cent and rest is reinsured. These companies are getting only the reinsurance commission. &nbsp;</p>
<p style="text-align: justify;">
	<strong>Some insurance companies are trying to form a pool to collectively handle the aviation insurance claims. What is your view on this proposal?</strong></p>
<p style="text-align: justify;">
	It is still in the pipeline. Nothing concrete has come out so far. But if such a pool is formed, it will help both the aviation insurers as well as the airliners. After the formation of the pool, they don’t have to run around different countries trying to find out the lowest rate. Once the pool is formed, they know that they have to approach only one office which will organize everything. And the office will be the consortium of a number of insurance companies.&nbsp;</p>
<p style="text-align: justify;">
	<strong>What future do you see for aviation insurance business in Nepal?</strong></p>
<p style="text-align: justify;">
	The future is good because there is a tremendous growth in the tourism sector in Nepal. The tourism sector has a tremendous scope and the more this sector grows, the more the aviation sector expands. More people prefer to travel by air in Nepal considering the time taken in travelling by roads. By air you reach Pokhara in 20-25 minutes.But if you take a bus, it takes 5- 6 hours. And the growth of airliners has paved the road for growth of the aviation insurance companies.&nbsp;</p>
<p style="text-align: justify;">
	<strong>Almost whatever the insurance companies earn from the aviation segment goes to the reinsurance companies abroad. Some are even said to be making losses in the aviation segment. It is said that the companies know that they are not going to make profits from the aviation segment. But they do aviation insurance just to show high insurance premium collection. What do you say?</strong></p>
<p style="text-align: justify;">
	It is not like that. The premium is based on the past losses. If you see the statistics, almost every year there is an air crash and some years, there are around two air crashes in Nepal. And the rate of premium is governed by the reinsurance market. Because of the air accidents, some of the reinsurers were hesitant to do business in Nepal. The aviation summit last month also put forth lots of similar issues in the aviation industry- the dos and the don’ts. Beyond that, the aviation business has a very bright future.&nbsp;</p>
<p style="text-align: justify;">
	<strong>Aviation insurance premium in Nepal is said to be one among the highest in the world? Why is it so high?</strong></p>
<p style="text-align: justify;">
	Yes. As I already said, insurance premiums are based on the past losses. Because of the crashes, the premium has been rising. The recent crashes of Sita Air and Agni Air were a serious concern for the reinsurers.&nbsp;</p>
<p style="text-align: justify;">
	<strong>Are those high premium rates justifiable?&nbsp;</strong></p>
<p style="text-align: justify;">
	The loss is calculated based on the coverage offered by the insurance companies. Suppose there is a loss. You pay some percent of the loss. You pay for the hull losses and the machinery parts or you pay for the passenger liabilities. Passenger liability losses are much higher than the hull losses depending on the kind of passengers. The liability losses are much higher if the passengers are from the US or Canada, and lower if they are from the SAARC countries. The liability losses vary from people to people because of theirs living standard. While finalizing the rates, reinsurers study these things.&nbsp;</p>
<p style="text-align: justify;">
	Airliners not only fly Nepali people or SAARC people but also other foreigners. For example, most of the people in the mountain flights are from European countries. Furthermore, airliners have different premiums depending on their types, aircraft, and management facilities they have.&nbsp;</p>
<p style="text-align: justify;">
	<strong>How can we lower the high insurance premium?</strong></p>
<p style="text-align: justify;">
	It’s a million dollar question. It has to be high, otherwise it won’t be viable. We are not totally dependent on our own companies. We may not have the capacity, so we need to approach other markets for reinsurance. When the losses start decreasing, the premiums will simultaneously come down. For example in India, the fire premium rate was very high in the past. Many studies were conducted. And when they calculated the total premium over a period of time, and how much profit they generated- then the premium started coming down. Likewise, though the premium is high at the moment, it will definitely go down every year if the risk is reduced. In the present scenario, you don’t have any choice. Until the reinsurer accepts the business, how can you reinsure?</p>
<p style="text-align: justify;">
	<strong>The country’s first-ever aviation insurance summit was organized in the capital recently. How helpful was this summit?</strong></p>
<p style="text-align: justify;">
	I think it was helpful. We got to know the perspectives of different reinsurers present there. It was the first of its kind event in Nepal and was helpful for everyone involved in the aviation industry.&nbsp;</p>',
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			'description' => 'We have high retention capacity. We re-insure the portion to other reinsurance companies that is beyond our financial strengths.',
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		'Article' => array(
			'id' => '868',
			'article_category_id' => '40',
			'title' => 'Unhealthy Competition Among The Insurance Companies Should Be Stopped',
			'sub_title' => '',
			'summary' => null,
			'content' => '<p>
	<span style="color:#23c8fa;"><span style="font-size: 16px;"><strong>‘Unhealthy competition among the insurance companies should be stopped’</strong></span></span></p>
<p>
	<strong><img align="right" alt="Prem Bahadur Maharjan, Rastriya Beema Sansthan" height="307" src="http://www.newbusinessage.com/ckfinder/userfiles/Images/prem_cover_story_feb2013.jpg" style="margin:0 0 0 10px;" width="250" /></strong></p>
<address style="text-align: right;">
	<strong>Prem Bahadur Maharjan&nbsp;</strong></address>
<address style="text-align: right;">
	<strong>Chairman</strong></address>
<address style="text-align: right;">
	<strong>Rastriya Beema Sansthan</strong></address>
<div>
	 </div>
<p style="text-align: justify;">
	<strong>What is your company’s stake in the aviation insurance market?</strong></p>
<p style="text-align: justify;">
	The amount of insurance is calculated in foreign currency. We own around USD 2 million business which constitutes 30 to 40 per cent of the total aviation insurance business. We are the only insurance company insuring big aircraft including jet planes. We have insured the Jet planes of the national flag carrier, Nepal Airlines, and BB Airways lately. We have succeeded in acquiring the largest proportion of insurance share in the market because national airlines is insured with us. &nbsp;&nbsp;</p>
<p style="text-align: justify;">
	<strong>Is it true that the insurance companies have not been able to make profits from aviation insurance? Why?</strong></p>
<p style="text-align: justify;">
	I don’t agree with this. &nbsp;In our case, we feel that there is some harsh competition including in the premium rates. And particularly in the private airlines sector, we have witnessed a number of air crashes. That might have contributed to the loss in the overall aviation insurance business but it is not the case of Beema Sansthan. We have not gone through such loss. Nor &nbsp;have our clients faced such air crashes.&nbsp;</p>
<p style="text-align: justify;">
	<strong>Some insurance companies are trying to form a pool to collectively handle the claims on aviation insurance. When could we see such a pool?</strong></p>
<p style="text-align: justify;">
	I have also heard about it. I guess the practice of collectively handling the aviation insurance claims is yet to materialize. It would be good if such a pool is formed. It will help prevent unhealthy competition.&nbsp;</p>
<p style="text-align: justify;">
	<strong>What future do you see for aviation insurance business in Nepal?</strong></p>
<p style="text-align: justify;">
	I see a lot of potential for this business. &nbsp;The aviation market has grown in Nepal over the years and with it, the aviation insurance business, too, has grown. The other big reason is that Nepal is promoting tourism by organizing many events. This has increased the number of air passengers to Nepal and thus helped the aviation insurance in the country.&nbsp;</p>
<p style="text-align: justify;">
	<strong>Almost whatever the insurance companies earn from the aviation segment goes to the reinsurance companies abroad. Some are even said to be making losses in the aviation segment. It is said that the companies know that they are not going to make profits from the aviation segment. But they do aviation insurance just to show high insurance premium collection. What do you say?</strong></p>
<p style="text-align: justify;">
	In a way, it is true. Since we don’t have a strong financial institution that can cover the aviation insurance, we depend on foreign reinsurance companies. Though the percentage of commission from premium collection that we collect seems minimal, we are able to sustain the operation. Though the commission might be less in comparison to the bigger amount of insurance premium; we have other indirect benefits as well. It is because we have to reinsure &nbsp;with very reliable reinsurance companies recognized internationally. There are very few reliable reinsurance companies. Beema Sansthan has found a re-insurer based in the United Kingdom.&nbsp;</p>
<p style="text-align: justify;">
	<strong>What do you expect from the Beema Samiti or the government for that matter to facilitate the aviation insurance business in the country? &nbsp;</strong></p>
<p style="text-align: justify;">
	There is unhealthy competition among the insurance companies at present. They tend to take the aviation insurance business at low rates ignoring the risk factors. The situation is such that some companies might collapse if something bad happens to the airlines they have insured. Moreover, I have heard that some insurance companies are even unable to pay out the claims. Beema Samiti, being the regulatory body, can set some standards to avoid such kind of unhealthy competition. Beema Sansthan is a government-owned institution. So, it does not need to jump into this unhealthy competition. Though aviation insurance is growing, almost all the premium collected here goes abroad. We get only a fraction of it as commissions. I think this is the time that Beema Samiti should form a government-owned re-insurance company in Nepal. It will help us to stop or decrease the amount of money going outside the country.&nbsp;</p>
<p style="text-align: justify;">
	<strong>What are the key challenges and issues facing the aviation insurance industry in Nepal?</strong></p>
<p style="text-align: justify;">
	As I already mentioned, the first challenge is unhealthy competition among some insurance companies. The risk factor is also growing and it is making premiums costlier. We have witnessed many air crashes in a quite short period of time. It is not only about insurance, it is also about the safety of the people.&nbsp;</p>
<p style="text-align: justify;">
	<strong>What needs to be done to address these challenges?</strong></p>
<p style="text-align: justify;">
	There has to be a strict monitoring mechanism for air traffic discipline. People involved in the aviation business should be given safety education. Pilots should also be alerted not to take any sort of risks.&nbsp;</p>
<p style="text-align: justify;">
	Moreover, unhealthy competition among the insurance companies should be stopped. And it could be managed since there are very limited insurance companies in the aviation sector. Furthermore, the government should try to establish reinsurance companies here in Nepal itself.</p>
<p style="text-align: justify;">
	<strong>The country’s first-ever aviation insurance summit was organized in the capital recently. How did you find this summit?</strong></p>
<p style="text-align: justify;">
	From educational point of view, the summit was quite fruitful to the people involved in the aviation insurance sector. It was successful in raising the issues related to the risk factors in the aviation insurance and about the premiums that are in practice. Such summits are helpful in making people aware about the things happening in the aviation insurance market. I expect such events to continue.&nbsp;</p>',
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			'description' => 'The first challenge is unhealthy competition among some insurance companies.The risk factor is also growing and it is making premiums costlier.',
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			'id' => '867',
			'article_category_id' => '40',
			'title' => 'Airclaims Is A Major Resource For Nepali Civil Aviation',
			'sub_title' => '',
			'summary' => null,
			'content' => '<address>
	<strong style="text-align: right;"><font color="#23c8fa" size="3"><span style="font-style: normal;">‘Airclaims is a major resource for Nepali civil aviation’</span></font></strong></address>
<address>
	<strong style="text-align: right;"><font color="#23c8fa" size="3"><span style="font-style: normal;"><br />
	</span></font></strong></address>
<address>
	<strong>Douglas G Cavannagh</strong></address>
<address>
	<strong>Risk and Safety Manager</strong></address>
<address>
	<strong>Airclaims&nbsp;</strong><strong>(A UK-based leading reinsurance company)</strong></address>
<p style="text-align: justify;">
	<strong><br />
	</strong></p>
<p style="text-align: justify;">
	<strong>How long has your company been involved in the insurance business in Nepal?&nbsp;</strong></p>
<p style="text-align: justify;">
	Airclaims is the leading provider of claims, risk management and asset management services to the global aviation industry. Founded in 1964 Airclaims has been handling aviation insurance claims in Nepal since the late 1960s. Airclaims currently handles in excess of 2500 assignments each year though a global network of 20 offices. Airclaims is the leading provider of such expertise worldwide.&nbsp;</p>
<p style="text-align: justify;">
	In terms of Airclaims risk and safety consulting services this service offering was initially utilised by aviation insurance underwriters to assess the risk profile of different operators. The initiation of these studies was often a consequence of a serious accident or a deteriorating loss record on the part of an operator.&nbsp;</p>
<p style="text-align: justify;">
	As our capability grew these services were expanded to include risk and safety assessments of maintenance, repair and overhaul facilities, helicopter operators, ground handling companies and airports. During the past 20 years many of these services have also been utilised by petroleum and mining companies who use our expertise to assess the risk of different contractors that they use. Airclaims is now one of the leading providers of operator risk assessments in this sector. Our experience is often in demand from investors who require a bespoke due diligence study to assist them to better understand the risks associated with a potential acquisition and to provide valuations and condition surveys of aircraft to potential purchasers or those who wish to update the value of their aviation assets. We also undertake a considerable amount of work for airlines and operators who require a completely impartial assessment of their operation and a worldwide perspective to help them improve their own internal safety capability. This ranges from the initial assessment and needs analysis, to project management, training, coaching and final assessment.&nbsp;</p>
<p style="text-align: justify;">
	In today’s challenging asset management environment, the demand is for a business partner that not only has a strong reputation and broad capability but also the consistency of approach.&nbsp;</p>
<p style="text-align: justify;">
	Our integration of what are typically considered separate functions, such as project management, airworthiness oversight, powerplant services and risk management are all combined to form ten core modules, providing a unique capability&nbsp;</p>
<p style="text-align: justify;">
	<strong>How do you differentiate yourself from other companies?</strong></p>
<p style="text-align: justify;">
	We differentiate ourselves by:&nbsp;</p>
<ul>
	<li style="text-align: justify;">
		Drawing on ‘real world’ experience gained from our involvement in the aftermath of many of the largest aviation accidents and losses during the past 50 years.&nbsp;</li>
	<li style="text-align: justify;">
		Being able to recommend bespoke solutions to mitigate risk based on our work with all the different parties involved in aviation, not just airlines and operators.&nbsp;</li>
	<li style="text-align: justify;">
		Using our international experience gained from working with many different nationalities and cultures, to train and coach organisations on how to achieve the same objectives using alternative methods.&nbsp;</li>
	<li style="text-align: justify;">
		Using our exposure to accident sites and our knowledge of emergency response services to tailor procedures to the reality of what actually happens during these events.&nbsp;</li>
</ul>
<p style="text-align: justify;">
	<strong>The size of your business in Nepal at present?&nbsp;</strong></p>
<p style="text-align: justify;">
	That really depends on how often there is an accident. Unfortunately for some that has been a little too often. If there was to be a reduction in the number of accidents as a result of Airclaims providing Risk Management rather than Claims Management Services then that would be fine with us too. We are currently the preferred aviation claims handling company for the national airline and a number of domestic operators in Nepal and also most International carriers who operate services to Kathmandu. Our presence in Nepal over many decades has enable Airclaims to build up much valued relationships.&nbsp;</p>
<p style="text-align: justify;">
	<strong>Why is the insurance premium in aviation so high in Nepal?&nbsp;</strong></p>
<p style="text-align: justify;">
	There are a number of factors that affect the rate at which the insurance premium is calculated in any market. Some of those factors are loss record, operating environment and the type and value of the aircraft being insured.&nbsp;</p>
<p style="text-align: justify;">
	Nepal is undoubtedly a challenging operating environment for operators and crews in terms of terrain, weather and infrastructure and these factors do mean that along with a loss record that reflects these challenges, insurance costs will be higher. However, with improvements in infrastructure, training and operations, it is quite possible to address many of these factors and in doing so ensure that the cost of insurance is maintained at a reasonable level.&nbsp;</p>
<p style="text-align: justify;">
	There is also the factor of insurance market capacity something which cannot be directly influenced in Nepal. Worldwide, it could be said that there is a good deal of capacity i.e. insurers who want to underwrite aviation risks. Capacity and competition help keep the price down although, Nepal is seen as a higher risk region because of the factors already mentioned above.&nbsp;</p>
<p style="text-align: justify;">
	We know that all parties involved in aviation in Nepal are keen to support the improvements that are needed to ensure risk is reduced and Airclaims are ready to play its part in the provision of not just loss management services but also risk management services.&nbsp;</p>
<p style="text-align: justify;">
	<strong>What are the challenges faced by the aviation insurance business in Nepal?&nbsp;</strong></p>
<p style="text-align: justify;">
	The challengers faced by the aviation insurance business in Nepal are the challenges that face the aviation operators as well. The biggest challenge is to reduce operational risk. Despite the significant challenges that are faced, Nepal is clearly serious in its desire to reduce risk and consequently improve safety. It can be done.&nbsp;</p>
<p style="text-align: justify;">
	The main challenges facing aviation in Nepal are:&nbsp;</p>
<ul>
	<li style="text-align: justify;">
		Infrastructure improvement. There needs to be a significant investment in better basic airport facilities (i.e. runways, navigation aids, etc.)&nbsp;</li>
	<li style="text-align: justify;">
		Weather reporting. There is a requirement for a significant number of automatic weather stations to report the weather being experienced in real time, via satellite link, in the more remote parts of the country.&nbsp;</li>
	<li style="text-align: justify;">
		Better operational control being exercised by the operators. It needs to become a complete team effort especially when difficult decisions are needed associated with dispatch of aircraft in the difficult operational environment that exists.&nbsp;This will become even more important over the next decade or so as the average age and experience levels of pilots are reduced.&nbsp;</li>
	<li style="text-align: justify;">
		More and better training to help reduce the effect of the loss of highly experienced pilots over the next ten years.&nbsp;</li>
</ul>
<p style="text-align: justify;">
	<strong>What can Nepal do to overcome these challenges?&nbsp;</strong></p>
<p style="text-align: justify;">
	The system of regulation that has been in place for the past 50 plus years may have reached its maximum effectiveness. Regulation by requiring compliance with rules and regulations has probably got as good as it will get globally. The adoption of a more proactive and predictive Safety Management System (SMS) is needed by the operators and aviation authorities in Nepal. Having an effective way of safety oversight such as through adoption of a Safety Management System (SMS) has been proved to improve safety and risk management culture. Such a system can be used to support airline owners, airline managers, pilots &amp; engineers and all who are involved in aviation; this includes the regulators who must have a key role in supporting new ways of looking at risk and safety management and oversight.&nbsp;</p>
<p style="text-align: justify;">
	<strong>The annual claims payout in the aviation section has been constantly rising. This is bound to further increase the already significantly high aviation insurance premium. How are we going to tackle this problem?&nbsp;</strong></p>
<p style="text-align: justify;">
	The current global picture is interesting with record low levels of claims for successive years. Unfortunately this trend has not been seen in Nepal. Tackling the problem will require leadership on the part of the regulating authorities towards resetting the scene for risk and safety management such as through improvement in the operational management operators. The regulating authorities can and need to play a leading role in improving oversight and ensuring that all operators are able to take advantage of an open and even handed approach to improvement of infrastructure and operational standards. Operators investing in good safety systems and management should be supported and those that are failing to do this need to be provided with proper advice and if necessary some forms of sanction up to and including withdrawal of AOC.&nbsp;</p>
<p style="text-align: justify;">
	New approaches and thinking will bring positive benefits. We can’t just keep doing business as we have always done and expect things to get better on their own. Change is inevitable in all businesses not least aviation and the benefits to Nepal can be significant in terms of social and economic reward.&nbsp;</p>
<p style="text-align: justify;">
	<strong>What prospects do you see for aviation insurance business in Nepal in the future?&nbsp;</strong></p>
<p style="text-align: justify;">
	The prospects for aviation insurance business in Nepal are bright. There is a capable and knowledgeable local market which has good relationships with the global insurance community. The present level of risk is too high but there are enough insurers willing to support the market, albeit currently at a higher cost than in some other places. What is perceived as the current high cost of insurance can and should be reduced for operators who demonstrate a good safety culture and record, adopt a Safety Management Programme that is working well and can prove that it is making a difference.&nbsp;</p>
<p style="text-align: justify;">
	<strong>Is there anything else that you would like to say?&nbsp;</strong></p>
<p style="text-align: justify;">
	As a leading provider of Claims Handling and Risk and Asset Management Services and with our long association with Nepal aviation, Airclaims can help make a safer environment for all stakeholders in aviation in Nepal, but it has a cost. Therefore, we are ready to work with the leaders of aviation in Nepal to support Nepal in the development of its aviation capability and ambitions with safety as the focus of any plan. Once it happens all of Nepalese society will reap the benefits.&nbsp;</p>',
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		'Article' => array(
			'id' => '866',
			'article_category_id' => '40',
			'title' => 'Sky Is The Limit For Aviation Insurance In Nepal',
			'sub_title' => '',
			'summary' => null,
			'content' => '<p style="text-align: justify;">
	<img align="right" alt="Prakash Panday, Shikhar Insurance Company Ltd" height="276" src="http://www.newbusinessage.com/ckfinder/userfiles/Images/prakash_panday_cover_feb2013.jpg" style="margin: 0px 0px 0px 10px;" width="235" /></p>
<address style="text-align: right;">
	<strong style="color: rgb(35, 200, 250); font-size: 16px; font-style: normal;">‘Sky is the limit for aviation insurance in Nepal’</strong></address>
<address style="text-align: right;">
	 </address>
<address style="text-align: right;">
	<strong>Dip Prakash Panday</strong></address>
<address style="text-align: right;">
	<strong>CEO</strong></address>
<address style="text-align: right;">
	<strong>Shikhar Insurance Company Ltd</strong></address>
<p>
	 </p>
<p style="text-align: justify;">
	<strong>What is the size of the aviation insurance market in Nepal?</strong></p>
<p style="text-align: justify;">
	The total size of the aviation insurance market of the domestic private sector in Nepal is around USD 8.5 -9 million.&nbsp;</p>
<p style="text-align: justify;">
	<strong>What about your company’s stake in the market?</strong></p>
<p style="text-align: justify;">
	We have around 70-75% market share.</p>
<p style="text-align: justify;">
	<strong>Is it true that the insurance companies have not been able to make profits from the aviation insurance? Why?</strong></p>
<p style="text-align: justify;">
	Aviation Insurance in Nepal has been a loss making portfolio for all the insurers involved. &nbsp;This has been because of the losses in the last couple of years. Nepal is being taken as a high risk zone for aviation insurance.&nbsp;</p>
<p style="text-align: justify;">
	<strong>It is said that some insurance companies are trying to form a pool to collectively handle the aviation insurance claims. What is the latest progress in this regard?</strong></p>
<p style="text-align: justify;">
	It is a very good concept. Reinsurance companies support about 99.5 per cent insurance and only 0.5% is handled by the local insurance companies. The main idea behind forming this pool is to take the advantage of the volume and also to get quality reinsurers so that losses get paid in a timely manner and also to have standardization in all the policies. &nbsp;This can also help in some investment in safety features.&nbsp;</p>
<p style="text-align: justify;">
	<strong>How is this pool going to help the insurance companies, if and when it is formed?</strong></p>
<p style="text-align: justify;">
	It is still in the planning process. Insurance companies and operators have to come together with full support from the regulators before such a pool can be formed. &nbsp;</p>
<p style="text-align: justify;">
	<strong>What future do you see for aviation insurance business in Nepal?</strong></p>
<p style="text-align: justify;">
	Sky is the limit for aviation insurance in Nepal. The only thing is that safety factors have to be improved. Nepal’s aviation sector is classified as the highest risk zone for reinsurers. We want to see Nepal as a safe destination. When a pool of insurers is going to own the overall aviation insurance, more responsibility shall be felt. Risk management is very important.&nbsp;</p>
<p style="text-align: justify;">
	<strong>Almost whatever the insurance companies earn from the aviation segment goes to the reinsurance companies abroad. Some are even said to be making losses in the aviation segment. It is said that the companies know that they are not going to make profits from the aviation segment. But they do aviation insurance just to show high insurance premium collection is. What do you say?</strong></p>
<p style="text-align: justify;">
	We are not sending money, we are transferring risk. The reason that the companies are still in profit is because the money is flowing in from the reinsurers abroad. Since they agreed to take the risk, they bear the losses as well. But after eight consecutive years of losses, they are getting scared. Some of the reinsurers have already withdrawn from the Nepali aviation market.</p>
<p style="text-align: justify;">
	<strong>How can we lower the high insurance premium?</strong></p>
<p style="text-align: justify;">
	It will take time. It is important to win the confidence of the reinsurers and prove that Nepal’s aviation sector is a safe zone for investment. This can be done only by reducing the losses. Fear is a very dangerous thing. Our terrains are difficult, which has sent a wrong perception. Similarly, loss is also a perception and this can be changed. All we need is 2 to 3 years of good loss ratio.&nbsp;</p>
<p style="text-align: justify;">
	<strong>What do you expect from the Beema Samiti or the government for that matter to facilitate the aviation insurance business in the country? &nbsp;</strong></p>
<p style="text-align: justify;">
	It would be great if the Beema Samiti would help in the process of making an Aviation Pool. Active participation and support is required from them and the Civil Aviation Authority of Nepal (CAAN), especially on the safety side. This should not be only on papers but also in practice.&nbsp;</p>
<p style="text-align: justify;">
	<strong>What are the key challenges and issues facing the aviation insurance industry in Nepal?</strong></p>
<p style="text-align: justify;">
	CAAN has to take the lead role. CAAN and the private airline operators should be more alert. There should be an improvement in monitoring flight data, safety infrastructure etc. For example, many airports in Nepal are not black-topped. When the weather is bad, flights should be aborted and airports should be closed. Individual behavior should be monitored by the operators. We also need to invest in training and skill development of the people involved in the aviation business.&nbsp;</p>
<p style="text-align: justify;">
	<strong>The annual claims payout in the aviation section has been constantly rising. This is bound to further increase the already significantly high aviation insurance premium. How are we going to tackle this problem?</strong></p>
<p style="text-align: justify;">
	There should be a considerable investment in safety measures. I feel that the only way out now is to produce good results for the reinsurers. Losses do happen but the frequency of losses in our country is high. If we go jointly, I feel that this will be a good beginning and we can produce significant results. &nbsp;</p>
<p style="text-align: justify;">
	<strong>There are various types of aviation insurance policies in the world. Are all of them available in Nepal?</strong></p>
<p style="text-align: justify;">
	Three basic types of aviation products are available in Nepal. These are basically for Hull, Liability including Passengers and Crew Personnel Accident and Hull War. Hull insurance covers the insurance of aircraft. Till last year, Combined Single Limit Liability insurance required was USD 60 million per aircraft which has now been revised. Hull War insurance is used in case of war, hijacking etc. &nbsp;</p>
<p style="text-align: justify;">
	<strong>The country’s first-ever aviation insurance summit was organized in the capital recently. How helpful was this summit?</strong></p>
<p style="text-align: justify;">
	Reinsurers came to the market and studied it. Their perception has changed. We took them to see our infrastructures including a mountain flight and had discussions on the current issues of the aviation market. We are trying our best to boost the reinsurers’ confidence. We feel that the summit has helped to bring some positive change in their risk perception of our country.</p>
<div style="text-align: justify;">
	 </div>',
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			'id' => '865',
			'article_category_id' => '39',
			'title' => 'NICL : Three Decades Of Insurance',
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			'content' => '<p>
	<img alt="National Insurance Company Limited (NICL)" height="60" src="http://www.newbusinessage.com/ckfinder/userfiles/Images/corporate_focus_feb2013.jpg" style="text-align: justify;" width="210" /></p>
<p style="text-align: justify;">
	National Insurance Company Limited (NICL) is a Government of India Undertaking and is operating in Nepal since 1973. NICL completed 106 years on 6th December 2012 and is into the 107th year of operation. Prior to nationalisation in India in 1972, it was operating as a private company. In 1972, at the time of nationalisation of Non Life Insurance Sector in India, there were 106 companies operating in India and later on, 22 Foreign and 11 Indian private companies were merged to form National Insurance Company Limited.</p>
<p style="text-align: justify;">
	National Insurance Company Limited (NICL) had hardly any competitions at the time of establishment, three decades back in Nepal. Now the company is facing a cut throat competition from 17 non life insurance companies in the Nepali market.&nbsp;</p>
<p style="text-align: justify;">
	The stiff competition does not deter the company from having its strong foothold in the market. NICL believes and enjoys working on a competitive environment. “We welcome competition in the insurance field. We strongly feel that competition is must to ensure prompt services to clients and it is good for the customers as they can look forward to better services,” said Dr Pronab Sen, Chief Executive Officer (CEO) of the company’s Nepal operations. However, the competition is mostly in the service front since most of the portfolios are tariff products and the rates are fixed by the regulators, so the competition is almost none on the premium rate front.</p>
<p style="text-align: justify;">
	<strong>Market Potentials</strong></p>
<p style="text-align: justify;">
	Though the competition has heightened much, insurance business has not been able to penetrate deep enough into the insurance market. Sen said that the penetration level is just 0.55 per cent. Therefore, the company sees huge untapped market potentials available.&nbsp;</p>
<p style="text-align: justify;">
	“I strongly feel that the non life insurance business can be increased many folds in Nepal as the awareness level is very low and we need to create insurance awareness among masses,” said Sen. Even though the Nepali insurance market has seen many players for the last three decades, still the awareness level lies low. The insurance market has not developed much during this time span. Sen feels that there is a need to recruit agents, who can propagate the message of insurance among the masses and make people understand the need of insurance. He believes that this could be the means to create indirect employment.</p>
<p style="text-align: justify;">
	Amid the competitive environment, the NICL has come up by leaps and bounds. Dr Sen said, “We have grown many folds in terms of business, manpower and networking.”</p>
<p style="text-align: justify;">
	<span style="font-size:14px;"><strong><img align="right" alt="Pronab Sen, National Insurance Company Limited" height="184" src="http://www.newbusinessage.com/ckfinder/userfiles/Images/corporate_focus_feb2013_pronab.jpg" style="margin:0 0 0 10px;" width="150" /><br />
	</strong></span></p>
<p style="text-align: justify;">
	<span style="font-size:14px;"><strong>‘We strongly feel that competition is must to ensure prompt services to clients and it is good for the customers as they can look forward to better services.’</strong></span></p>
<p>
	<span _fck_bookmark="1" style="display: none;">&nbsp;</span></p>
<address>
	Dr Pronab Sen</address>
<address>
	CEO, Nepal Operations</address>
<address>
	National Insurance Company Ltd</address>
<p>
	<span _fck_bookmark="1" style="display: none;">&nbsp;</span></p>
<p style="text-align: justify;">
	<strong>Market Presence</strong></p>
<p style="text-align: justify;">
	Currently the NICL has six branch offices - three in Kathmandu and one each in Birganj, Biratnagar and Nepalganj. &nbsp;Sen said that the company has Beema &nbsp;Sewa &nbsp;Kendras &nbsp;in Hetauda and Janakpur. “Apart from this, we also have representatives based in Dhangadi, Dharan, Narayangarh, Simara and Birtamod with the controlling office in Kathmandu,” he explained.&nbsp;</p>
<p style="text-align: justify;">
	NICL has planned to expand its network to cities like Pokhara and Bhairahawa and upgrade the Beema Sewa Kendras to Sub Branch. Sen said that with a service oriented motive the NICL has some ambitious plans on a customer centric ground. Similarly the company is planning to organise insurance awareness programmes for the clients along with publicity and brand image.</p>
<p style="text-align: justify;">
	<strong>Products and Services</strong></p>
<p style="text-align: justify;">
	Being a non life insurance company, NICL offers wide range of products ranging from Motor, Fire, Personal Line policies like Sweet Home, Personal Accident, Health Insurance, Liability, and Aviation among others. According to Sen, the company has cattle and livestock and crop policy in its pipeline as the Insurance Board has already issued directives for the same.&nbsp;</p>
<p style="text-align: justify;">
	To ensure prompt services, the NLIC has centralised its claims processing and started a Centralized Claims Processing Hub in Kathmandu, with the sole idea of reducing the Turn Around Time (TAT) in claim processing, according to Sen. “On experimental basis, we have also started paying claims through Electronic Clearing Service (ECS) and in the initial stage, we are restricting it to the corporate clients and based on the results, we will initiate this system for all claims,” he revealed. Employee’s salary, surveyors payment and agency commission payment is being done through ECS as an experiment.</p>
<p style="text-align: justify;">
	<strong>Human Resources</strong></p>
<p style="text-align: justify;">
	The company has 76 employees as of now. &nbsp;The company believes that its employees are its most valuable assets. NICL gives value to the team work and the spirit of working in unity. Sen shared, “We are continuously trying to upgrade the soft skills of our team members with the motto “Grow Profitably” i.e. ensure top line as well as bottom line growth and feel proud to be an NICian.”</p>
<p style="text-align: justify;">
	He said that the company is continuously involved in developing the soft skills of its employees so that they can perform better and make the team more sensitive to customer’s needs and deliver results in time.&nbsp;</p>
<p style="text-align: justify;">
	Though having its parent company in India, NICL has just two expats from India and rest of its manpower is from Nepal itself. “Our recruitments are restricted to Nepali citizens only,” said Sen.</p>
<p style="text-align: justify;">
	However, one of the biggest challenges the company is facing at the moment is getting skilled manpower in insurance domain. To resolve this issue the NICL organises in-house training to its people.</p>
<p style="text-align: justify;">
	<strong><img align="left" alt="National Insurance Company Limited" height="314" src="http://www.newbusinessage.com/ckfinder/userfiles/Images/corporate_focus_feb2013_financial_highlights.jpg" style="margin:0 10px 0 0;" width="282" />Management Mantra</strong></p>
<p style="text-align: justify;">
	The NICL believes in maintaining the transparency and good corporate governance to its best. Sen explained, “Our management’s commitment is to maintain transparent working and remain committed to compliance of tariff and guidelines of the regulator and law of land.” The company has been able to maintain a cordial relationship with the regulator – Insurance Board of Nepal - in its operation history and strictly abide by all the rules and regulations issued by the regulator.&nbsp;</p>
<p style="text-align: justify;">
	Managing claims is probably one of the challenging jobs at an insurance company. To handle the sensitive issue, the company is concentrating on improving claims services and reducing TAT for claims settlement. Sen believes, being a part of the service sector, the overall business depends on the quality of the services offered. “Now we have a process in place, to depute surveyors immediately on receipt of the claim irrespective of the fact whether it is a holiday or a working day,” he said, “To complete the formalities to enable us to settle client’s claims at the earliest possible.”</p>
<p style="text-align: justify;">
	<strong>CSR Activities</strong></p>
<p style="text-align: justify;">
	Beginning from the 107th Foundation day on 6th December 2012, the NICL has initiated the CSR activities in Nepal. As a part of the CSR activities, the company distributed 107 blankets and rechargeable torches to poor elderly people and orphan children. NICL also organised a health check up camp and blood donation camp on 6th January 2013, which was attended by the NICL employees, clients and surveyors apart from general public. The company plans to plant 107 saplings shortly along with numerous other CSR plans in the pipeline.</p>
<p style="text-align: justify;">
	Similarly, the company is also the Gold Sponsor of Walkathon organised by Standard Chartered Bank every year for helping restoration of eyesight of visually impaired and to help the HIV infected persons in Nepal.</p>
<div>
	<img alt="National Insurance Company Limited" height="563" src="http://www.newbusinessage.com/ckfinder/userfiles/Images/corporate_focus_feb2013_swot.jpg" width="277" /></div>
<p>
	 </p>',
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			'description' => 'Though the competition has heightened much, insurance business has not been able to penetrate deep enough into the insurance market.',
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	(int) 9 => array(
		'Article' => array(
			'id' => '864',
			'article_category_id' => '38',
			'title' => 'Three “R”s For  Startup Businesses',
			'sub_title' => '',
			'summary' => null,
			'content' => '<p style="text-align: justify;">
	<span style="text-align: justify;">Businesses are hard to predict. There is a saying “God laughs at those who plan the future”. This applies both to life and to businesses, especially the ones that are just starting. Pukar Shah, a returnee from the UK, has recently started a business of planting Aloe Vera in his own ancestral land that was mostly going to waste due to shortage of trusted labourers. He believes that Nepal can improve its status only by making large investments in the agriculture sector. While the rest of the world has reached far away from the time of doing agriculture, 80 per cent of Nepal‘s population still relies on nature for a living. &nbsp;This is not only a culture but also a big natural advantage to Nepal. Nepal can grow everything that grows in between 8000 m to 60 m above sea level. While the richest country of the world, the US, with its organization USAID is investing in Nepal’s agriculture with projects like FTF (Feed the Future) and Health for Life (H4L), it is an opportunity to respond. Plus, according to Pukar, it is a risk-free business because he already has a line of buyers who want to buy his produce.&nbsp;</span></p>
<p style="text-align: justify;">
	Harvard Business School Professor Noam Wasserman has outlined &nbsp;three Rs for the people wanting to start up their own business. In his article, Wasserman lists them as “Three Pitfalls Startup Founders must avoid”. These are the relationship decisions, roles decisions, and rewards decisions. According to Prof Wasserman, while starting a new business, there’s a strong temptation to make decisions for the short term. But you need to anticipate the long-term challenges. It is very critical to get at least three things right. They are:&nbsp;</p>
<p style="text-align: justify;">
	<strong>Co-founders:</strong> The natural inclination is to co-find with family or friends. But these relationships can be fraught. Plus you’re more likely to have similar perspectives. Look for partners who bring complementary skills and assets.&nbsp;</p>
<p style="text-align: justify;">
	<strong>Roles:</strong> Most founders want a C-level title. After all, they were there from the start. But choose roles that reflect the actual work each founder will do, not the fancy title he wants to show off.&nbsp;</p>
<p style="text-align: justify;">
	<strong>Rewards: </strong>One of the biggest questions for start-ups is how to split the equity ownership. A handshake on 50/50 will not do because almost all new companies will have a major change in strategy or founder involvement. Negotiate an arrangement that can change when the circumstances do.</p>
<div style="padding:10px; background:#f4f3e6;">
	<p>
		<strong><span style="font-size:14px;">Naming the Company</span></strong></p>
	<p style="text-align: justify;">
		Together with the ideas, management and operation planning, NAME for the Startup Organization also makes a considerable difference. What’s in a name? Well judging from the long list of businesses that a simple Google search can yield when you search “naming your company”, there are plenty. While deciding on a name, don’t take the decision lightly. Not only is your company’s name a critical part of your overall identity, but it will also be used on any of your marketing products, PR, blogs, websites and publications. Given below are five naming strategies that have been successful globally.&nbsp;</p>
	<p>
		<strong>Real Words</strong></p>
	<p style="text-align: justify;">
		When you consider, Apple, Yahoo, Indeed and Amazon, they mean something but often they have no immediate relation to their business.&nbsp;</p>
	<p style="text-align: justify;">
		<strong>Misspelled Words</strong></p>
	<p style="text-align: justify;">
		No, this isn’t an insult of your intelligence. We know that you know how to spell, but using phonetics rather than grammar may give you that cool edge you need. Consider some of these well known examples; Tumblr (Tumbler), Del.icio.us (Delicious), Digg (Dig) and Flickr (Flicker).&nbsp;</p>
	<p style="text-align: justify;">
		<strong>Two Syllable, Compound Words</strong></p>
	<p style="text-align: justify;">
		There are plenty of new companies moving in this direction. Among some of the most popular, there’s BirchBox, SkillShare, CrowdTilt and JackThreads. This could possibly have something to do with the success of FaceBook.&nbsp;</p>
	<p style="text-align: justify;">
		<strong>Initials and Acronyms</strong></p>
	<p style="text-align: justify;">
		Think about going old school, such as IBM (International Business Machines), AOL (America Online) and TBS (Turner Broadcast System). You’re not alone. Reportedly, Rupert Murdoch is considering changing the name of The Wall Street Journal to simply “WSJ”.&nbsp;</p>
	<p style="text-align: justify;">
		<strong>Made-Up Words</strong></p>
	<p style="text-align: justify;">
		Skype, Hulu and Zynga are all made up words. But if you’re successful, you most likely won’t find yourself in any trademark grudge matches in the future.&nbsp;</p>
	<p style="text-align: right;">
		<span style="font-size:11px;">(Source: compiled from various sources)</span></p>
</div>
<p>
	 </p>
<p style="text-align: justify;">
	Pukar, in his startup business, has successfully implemented all these strategies. He happens to follow this idea from his uncle who has been involved in this sector for over 20 years now. Pukar is confident that his uncle’s expertise and his knowledge in proper management of the company will help him succeed in the long run in this sector. Pukar is not obsessed with the CEO title. He has chosen the role of managing the production process and looking after the financials while his uncle handles the marketing department. He had set up an initial agreement of 50 per cent &nbsp;investment and 50 per cent &nbsp;returns with his uncle. But according to him, he currently owns only 35 per cent of the return and the overall organization has four shareholders from two in just a matter of a year. He believes that one cannot have a fixed agreement in business; instead, one needs to go with the flow.</p>
<p style="text-align: justify;">
	Also, it is very crucial to understand the cash flow before starting a business. More than a third of new businesses fail in the first three years and it’s rarely because of a bad business concept; it’s almost always the result of running out of cash. As well as having working capital to cover early stage losses, it’s imperative that you collect your invoices on the due date. If you don’t, you are providing working capital to your customers and unless you are running a bank, you can’t afford to do this. According to Pukar, if cash is the king for a successful business, it’s the emperor for a start-up. &nbsp;</p>
<p style="text-align: justify;">
	<img align="left" alt="Management February 2013" height="259" src="http://www.newbusinessage.com/ckfinder/userfiles/Images/management_feb2013(4).jpg" style="margin:0 10px 0 0;" width="250" />For Pukar, there was no problem of having insufficient resources and capital for giving a shape to his idea, but most of us who want to start a business do not have the resources and capital. Not only in Nepal but also in most of the developed countries in the world, there are angel investors. Angels typically invest their own funds, unlike venture capitalists, who manage the pooled money of others in a professionally-managed fund. Angel investments bear extremely high risk and are usually subject to dilution from future investment rounds. As such, they require a very high return on investment. A large percentage of angel investments are lost completely when early stage companies fail. Therefore,, professional angel investors seek investments that have the potential to return at least 10 or more times their original investment within five years through a defined exit strategy such as plans for an initial public offering or an acquisition. The Silicon Valley of the United States of America, also known as the home to many of the world’s largest technology corporations as well as thousands of small startups, was funded by the Angel investors from the beginning. A Harvard report by William R Kerr, Josh Lerner and Antoinette Scholar provides evidence that angel-funded startup companies have historically been less likely to fail than companies that rely on other forms of initial financing.</p>',
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			'id' => '863',
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			'title' => 'Is Shakespeare Relevant In Today’s Commercial World?',
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			'summary' => null,
			'content' => '<p>
	<strong style="text-align: justify;">By Sujit Mundul</strong></p>
<p style="text-align: justify;">
	There have been lots of debates and discussions on the relevance of Shakespeare’s heroes as leaders in the modern commercial world. On this widely debated subject, a great deal of work had happened in the Oxford University under the leadership of Richard Oliver.</p>
<p style="text-align: justify;">
	I have had the good fortune to interact with Richard many times on the issues of leadership, seeking his guidance. It is increasingly common to hear nowadays that we are facing a crisis of leadership. The ways in which organizations are moving forward can no longer be comprehended through the same models, language and logical analysis that have served leaders in the past.</p>
<p style="text-align: justify;">
	I could strongly agree with Richard that the time has come when businesses actually need what the arts have to offer in order to survive. We can draw a good deal of similarity between the commercial world and the arts, in that both the streams, apparently poles apart, need creativity, imagination, flexibility, adaptability, effective communication and visionary tendencies for survival as well as &nbsp;domination in the respective fields.</p>
<p style="text-align: justify;">
	Stories have been used to inspire and instruct us human beings since we learnt to speak.</p>
<p style="text-align: justify;">
	Let us take a look at Shakespeare’s stories. Henry V is the story from which we can glean the most about the nature of inspiration. From the first line that calls to our imagination with its plea for “a muse of fire”, to the last scene where Henry, as a Victorian leader, struggles to turn a battlefield into a garden, the plot, to my reckoning, reflects invaluable insights into leadership.</p>
<p style="text-align: justify;">
	Henry V unites a group of disparate people (his nobles) around a common goal (in this instance, reclaiming the territory of France) and manages to overcome all difficulties in his path to achieve a near miraculous victory against the odds (i.e. winning the Battle of Agincourt).</p>
<p style="text-align: justify;">
	So, readers are encouraged to see the King as an inspired leader, the nation as an organization, the nobles as the senior management team, and France as a big project. &nbsp;I am sure that once we start thinking along these lines, we can very well find the relevance of Shakespeare’s characters in today’s changing world. Shakespeare survives gracefully through the changing fads of every generation because he touches so consistently on the truth of human experience.</p>
<p style="text-align: justify;">
	Henry V takes over as King after the sudden demise of his father, the late King.But people can’t believe that Henry, who has the reputation of a spoiled brat, would allow Lord Chief Justice (a hard critic of Henry) to continue in the same position as also to become his mentor. In addition Henry promises to call Parliament. His journey begins.</p>
<p style="text-align: justify;">
	In Act 1 we see Henry meets with his nobles to gather support for achieving his mission to reclaim the territory of France. He gets their consent. Henry has sent a message to the King of France asking if he will give up his throne. The French ambassador arrives with an answer; a trunk which Henry assumes will be full of jewels in an attempt to buy him off. Instead, it is full of tennis balls sent by the French Prince with an accompanying message that Henry better stick to the trivial pursuits he is capable of winning like tennis. Henry gives the ambassador a right –royal telling off and sends him out. Finally, he makes a firm commitment to pursue his mission to France.</p>
<div>
	<img alt="Management February 2013" height="234" src="http://www.newbusinessage.com/ckfinder/userfiles/Images/management_feb2013(2).jpg" width="580" /></div>
<div>
	<div style="text-align: justify;">
		In commercial life, when we start our first project as a leader, we need to seek sound advice and believe in the “right” to go ahead. This “right” is granted internally and externally. Internally we can use a “line of service” to draw strength from. But we need certain amount of political intelligence to win the external right, to prepare our nobles (senior management) to take a risk and follow us into new territories. And we will have to make a demonstrable and visible commitment to pursue the project. If people think we are not totally behind this, the project may fail. Henry did follow all these steps.</div>
	<div style="text-align: justify;">
		 </div>
	<div style="text-align: justify;">
		In Act 2 Henry gathers and allocates his available resources and identifies and deals with those who oppose the mission (and the traitors) before it has even started.</div>
	<div style="text-align: justify;">
		 </div>
	<div style="text-align: justify;">
		In all major projects, leaders should be able to identify the forces ranged for and against them. Many a times, a good leader has to be a good actor. He may need to hide certain knowledge from certain people at certain times. He may need to disguise intentions, particularly while attempting to identify those who disagreed with the agreed mission and who may oppose its desired outcome. It is important to identify them correctly and deal with them appropriately for ensuring success of the project.</div>
	<div style="text-align: justify;">
		 </div>
	<div style="text-align: justify;">
		In Act 3, Henry starts with a reasonable plan: arrive in August with 10,000 troops, take the first foothold in a week and march on to Paris by Christmas. He lands at the coastal town of Harfleur as planned but three months later, he is still there having lost 2000 men. He makes a rousing speech to his exhausted troops. An effective leader will have to speak passionately and imaginatively to motivate them through the blocks. The next attack seems to make a difference, for the Governor of Harfleur asks for a peace party. Henry speaks and warns that if the town is not surrendered now; he will be unable to control his troop’s anger. Then when they do succeed, the town will be destroyed and people killed. The Governor surrenders the town. Henry insists that all the inhabitants be treated mercifully. He changes strategy and decides to withdraw to Calais (an English territory at that time) where his troops can rest over winter.&nbsp;</div>
	<div style="text-align: justify;">
		 </div>
	<div style="text-align: justify;">
		Throughout the play, Henry demonstrates the wonderful leadership quality of painting pictures of the future. Here he uses it to paint such a negative view of the future that the Governor gives in rather than risk that picture becoming reality. He does not press on to his initial goal regardless; he revises his strategy on the ground. Nor does he admit failure and simply retreat to England. He finds a third way; a strategic withdrawal.</div>
	<div style="text-align: justify;">
		 </div>
	<div style="text-align: justify;">
		The French army is chasing Henry’s exhausted 8000 walking men with 40,000 fresh mounted troops. Inevitably they catch up and surround the English on the field of Agincourt. The French Herald is sent in to offer Henry a simple choice; give in now (and pay a huge fine but Henry and all his troops leave), or fight tomorrow and die. Henry says he does not seek a battle at the moment; he wishes to march to Calais, but if challenged he will fight. The French prepare for battle.</div>
	<div style="text-align: justify;">
		<strong><span style="font-size:16px;"><br />
		</span></strong></div>
	<div style="text-align: justify;">
		<strong><span style="font-size:16px;">Managers have to solve problems. Leaders have to solve dilemmas, complex issues with no happy solutions. When leaders meet the real test, they will require to call on all their skills to hold a line that will give their people enough confidence to carry on</span></strong>. Act 4 shows Henry going through the long dark night before the battle, facing up to his fears and duties before being able to inspire his troops to an apparently miraculous victory against the odds.</div>
	<div style="text-align: justify;">
		 </div>
	<div style="text-align: justify;">
		Henry cannot really want to be out talking to his troops at 3 o’clock in the night. But he does it because it is required of him. He exercises visible leadership which is seen by others thus bolstering their confidence.</div>
	<div style="text-align: justify;">
		 </div>
	<div style="text-align: justify;">
		Leaders need to allow themselves to enter “the dark night of the soul” and face their own innermost fears, doubts and uncertainties, especially in a crisis, and particularly before they make decisions that affect the lives of others. If they don’t, they may make wrong decisions for the wrong reasons. There is a point in most meaningful projects when the leaders are forced to ask themselves: “Is this the right thing to do? And are we the right persons to do it?” In these times they will have to manage their own fears and the fears of others simultaneously but differently.</div>
	<div style="text-align: justify;">
		 </div>
	<div style="text-align: justify;">
		Henry is courageous enough to listen to what the troops really think. But if he listens carefully to what they are thinking, he may just be able to inspire them later. However, he also feels the weight of responsibility that they put on him. He needs to unload this or he may make his decision on what others want rather than what he thinks is right. When Henry arrives back at his tent, he overhears the nobles wishing for more troops. He speaks to them from the heart, telling them why he personally believes they are doing the right thing. He says they are enough to win honorably or die trying. He says those that do not wish to fight can leave. But any that chose to fight and survive will remember this day for the rest of their lives. They go off to start the battle.</div>
	<div style="text-align: justify;">
		 </div>
	<div style="text-align: justify;">
		The whole process of surviving the “Dark Night” has served to strip away layers to reveal Henry’s center, his core values - what he is doing all this for. Mind you, it is from this core that he speaks to inspire others.</div>
	<div style="text-align: justify;">
		The battle is going well for the English. They deal with the first wave of French attack and capture many prisoners. Another attack is sounded. Henry orders his men to kill the prisoners. Meanwhile the French have raided the luggage tents and killed all the boys who were guarding them. The Herald enters and tells Henry the day is his. He thanks God and forbids everyone to boast of the victory. They set off for Calais.</div>
	<div style="text-align: justify;">
		 </div>
	<div style="text-align: justify;">
		Most leaders wish they could get through their career without having to take any tough decision. Very few get their wish. There is usually a situation where we are forced to compromise the values on which we prided ourselves when we started our journey to leadership. It is the ability to take these hard decisions and live with the consequences that separates “the men from the boys” amongst the leaders.</div>
	<div style="text-align: justify;">
		 </div>
	<div style="text-align: justify;">
		In Act 5 Henry is encouraged to make peace and turn the battlefield into a garden. He attempts to court Princess Katherine (daughter of the French King) but realizes he has much to learn about building relationships before the political necessity becomes a heartfelt reality.</div>
	<div style="text-align: justify;">
		 </div>
	<div style="text-align: justify;">
		Katherine agrees to the marriage but Henry can tell she does not yet love him. He understands that he has to change his approach and learn a new way of life.</div>
	<div style="text-align: justify;">
		 </div>
	<div style="text-align: justify;">
		Many leaders have got where they are because of their ability to fight and win. Sometimes though, this is not enough. &nbsp;We may have to nurture the new territory we have achieved rather than look for the next target.</div>
	<div style="text-align: justify;">
		 </div>
	<div style="text-align: justify;">
		To my mind, Shakespeare’s relevance in the modern complex world of commerce holds good adequately. Nevertheless, I leave it to the readers to decide on this enunciation, as they feel apposite.</div>
	<div>
		 </div>
	<div>
		<strong>Mundul is a Director with Standard Chartered Bank Nepal Ltd.</strong></div>
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of every generation because he touches so consistently on 
the truth of human experience.',
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			'title' => 'Global Economy Outlook  For 2013: Figures & Beyond!',
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			'content' => '<p style="text-align: justify;">
	<strong>By Sandip Nepal</strong></p>
<p style="text-align: justify;">
	The year 2012 remained gloomy for the entire seven billion plus world population in terms of economic growth and prosperity. With world economic leaders like the USA, Eurozone and China not acquiring the ‘expected status’ for the year, i.e. 2012, amidst spiking issues like unemployment, inflation and debt crisis regimes, prospects for 2013 do not look encouraging at this point of time.</p>
<p style="text-align: justify;">
	Concerned over the ongoing austerity measures, high unemployment rate and lower business confidence combined with weak market sentiments in core global economies like the USA and Eurozone, the World Bank (WB) has lowered its forecast for 2013. Market analysts and global institutions, pioneering in economic forecasts, are coming up with new lowered growth forecasts for the current year in line with lower than expected manufacturing and trade indicators coming from both sides of the Atlantic. The world economy was initially expected to grow by 3 percent in 2013. However, the new growth forecast based on the current and prospect scenario has come out to be 2.4 per cent, lowered by 60 basis points from the initial forecast.&nbsp;</p>
<p style="text-align: justify;">
	Similarly, amidst reduced global growth, market analysts and economists from around the world have lowered their growth forecast for the ‘land of the rising sun,’ i.e., Japan, US and the more vigilant economy, the Eurozone. It is believed that the second year of contraction in the Eurozone will have a tremendous impact on the global economy and could act as a reverse-catalyst in the global economic atmosphere, measured by Global Purchasing Managers’ Index or any other global index. Having inter-twined relationship with economic superpowers &nbsp;such as China, Eurozone and the US, emerging economies like India, Brazil, Mexico and other East-Asian economies fear that they cannot remain unaffected by the contraction in the economic environment of the world’s economic hubs. However, developing economies from around the globe are expected to expand at the rate of above 5.5 per cent in 2013.</p>
<p style="text-align: justify;">
	The World Bank has already warned against the fragility and vulnerability of the global economy in the remaining months of 2013. On the other hand, the report has also emphasized that the magnitude of economic downside will be at decreasing rate compared to recent precursor years. If we turn back and scrutinize 2012, European measures, reforms and policies to cushion the financial/debt crisis in the single economic bloc have not been able to provide economic surge or even correction to the ongoing recession. At a time when financial and political agendas have not been facilitating economic improvement in the single currency bloc, issues related to spending cuts and tax hikes in the US, diplomatic tensions between Japan and China affecting trade environment, and ‘not so good’ manufacturing and industrial indicators coming from the US and China are feared to cloud whatever little optimism remains for &nbsp;the ongoing year.</p>
<p style="text-align: justify;">
	<strong>Global Economic Growth Forecast for 2013</strong></p>
<p>
	<strong><img align="left" alt="Economy and policy February 2013" height="230" src="http://www.newbusinessage.com/ckfinder/userfiles/Images/economy_policy_feb2013.jpg" style="margin: 0 10px 0 0; " width="250" /></strong></p>
<p style="text-align: justify;">
	Considering the gloom in the world economic regimes in 2012 and the grayish ongoing global economic performance, the US in 2013 is forecasted to grow by 1.9 per cent. With political tensions mounting between two core Asian economies, Japan and China, amid affected Japanese trade in automobiles and related industries, and with contraction in one of the largest export sectors, the Japanese economy is expected to witness a meager growth of only 0.7 per cent in 2013. Unlike the economies mentioned above, the Chinese economy with its improving manufacturing sector, satisfactory flow of Foreign Direct Investment and export data has been projected to grow by an attractive 8.4 per cent in 2013, though the figure is 20 basis points lower than the previous projection for the year. Further, increasing Chinese appetite for FDI outflow also exhibits the magnitude of its economy. Moving on to emerging economies, the growth rates for India, Brazil and Mexico have been projected to be 6.1, 3.4 and 3.3 percent, respectively. With economies like the Eurozone and the USA not really supporting these emerging economies, these expected growth rates could be deemed satisfactory.</p>
<p style="text-align: justify;">
	<strong>Nepali Economy in 2013 and Global Influence</strong></p>
<p style="text-align: justify;">
	Nepali exports have seen a decline in recent months, thanks to the economic slowdown in the Euro Area and a mild US economy. Nepali industries like, garment, herbs, handicraft, carpet, metal-wood and other related sectors are hit hard by the global meltdown. Combined with the international pessimism, ‘below-par’ agricultural and industrial performance is also contributing to drag the economy towards austerity. In line with the current and forecasted economic indicators, the WB has forecasted Nepal’s economic growth rate to be 3.8 per cent for fiscal year 2012-13, which is 80 basis points lower than the actual economic growth rate for fiscal year 2011-12.</p>
<p style="text-align: justify;">
	The key issues contributing to lowered growth forecast could be attributed to the ongoing constitutional crisis, poor investment environment (in terms of FDirectI) and infrastructural bottlenecks in the country. Besides the ongoing political instability and poor market sentiments, inadequate and inefficient public expenditure, too, has been hampering the economic outlook, which, in turn, may further contribute to downgrading the current forecasted growth rate. Remittance, working as a key source of financing, incorporates around 22 per cent of the national Gross Domestic Product (GDP). At this point of economic junction, as remittance has been facilitating to finance imports, covering trade deficits with counterparts, the year ahead could also see an optimistic inflow of funds, taking into account the numbers of Nepalis working abroad, especially in the Gulf countries.</p>
<p style="text-align: justify;">
	With the WB having already lowering Nepal’s growth forecast for fiscal year 2012-13 and remittance acting as an economic catalyst, it’s political leaders and government authorities who could possibly look into the matter and plug the loopholes in the operating environment, eventually facilitating, promoting and simplifying investment grounds for national and international market participants. Only time would tell what the government would do to address the situation and improve the country’s GDP growth rate, lower dependency on remittance and international debts for the year and henceforth.</p>
<p style="text-align: justify;">
	<strong>The author is Assistant Manager, Research &amp; Development Department, Mercantile Exchange Nepal Limited, Nepal.</strong></p>',
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			'description' => 'Concerned over the ongoing austerity measures, high unemployment rate and lower business confidence combined with weak market sentiments in core global economies like the USA and Eurozone, the World Bank (WB) has lowered its forecast for 2013.',
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	(int) 12 => array(
		'Article' => array(
			'id' => '860',
			'article_category_id' => '31',
			'title' => 'Visiting Business People: February 2013',
			'sub_title' => '',
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			'content' => '<p>
	<strong><span style="font-size:16px;">‘We help people make good change take root’</span></strong></p>
<p>
	<img align="right" alt="Bill Stockton" height="286" src="http://www.newbusinessage.com/ckfinder/userfiles/Images/bill_stockton_visiting_business_people(1).jpg" style="margin:5px 0 10px 10px;" width="250" /><strong> </strong></p>
<p style="text-align: justify;">
	<span style="color:#f00;">Bill Stockton</span> is a Senior Advisor of the Verghis Group, a management consulting firm.<span style="text-align: justify;">He is known as the ‘center of gravity’ for knowledge sharing practice and consulting within the financial sector including investment and retail banking and insurance companies in the Verghis Group. Stockton graduated in Psychology from the University of North Carolina at Chapel Hill. He served Deutsche Bank for 18 years, mainly in the IT department. &nbsp;He was the director and global head of support and operations for over 20 products including foreign exchange, equities, programme trading, cash management and more. Most recently, he was tapped by Deutsche Bank to institute a global knowledge sharing programme that trained over 3200 IT staff and demonstrated productivity gains. In an interview with Nubiz recently when he was in Kathmandu, Stockton shared the importance and need of knowledge sharing and knowledge management in any organization.&nbsp;</span></p>
<p>
	<strong><strong>Excerpts:&nbsp;</strong></strong></p>
<p style="text-align: justify;">
	<strong><strong>What are your recent engagements?</strong></strong></p>
<p style="text-align: justify;">
	I left Deutsche Bank as a Director and as an IT Manager. I left because I think I can do much more, particularly in the area of knowledge sharing in finance companies. We have three small companies in the Verghis Group. We can resolve things primarily on knowledge sharing and knowledge management. Also, we do a quite a lot of work on measures, metrics and madness which is about stopping measuring activities and reassuring for outcome. We do also have a research wing which conducts very exciting research, mostly on behaviour psychology- the kind of research we primarily conduct.&nbsp;</p>
<p style="text-align: justify;">
	<strong><strong>What brings you to Nepal?</strong></strong></p>
<p style="text-align: justify;">
	My ancestors had been coming to Nepal for a long time. We did not come here for business. We came here because we are interested in all the things we have heard about Nepal.&nbsp;</p>
<p style="text-align: justify;">
	<But my partner, Christina, has come here several times a year for the past ten years. &nbsp;Her visits are mainly aimed at supporting organizations like Sano Paila in Birgunj and other women’s groups for social service. Professionally, she is a doctor in psychology and has done quite a lot of work in areas like peace negotiation and conflict management. She is also from the leadership training which is mostly about working with people who don’t usually talk together productively. So, I joined her on a number of those session conducted here.&nbsp;</p>
<p style="text-align: justify;">
	>There are some really exciting possibilities in my mind about knowledge sharing. Many people don’t know what knowledge sharing or knowledge management is. A number of companies need knowledge management. Research show whether it be Deutsche Bank, Mega Bank or Coca-Cola - around 60-90 percent problem is solved by somebody else in the organization. So, knowledge management is about the behaviour and practices required to make that knowledge available to anyone who needs it in the organization.&nbsp;</p>
<p style="text-align: justify;">
	What I see is, when you get a really good idea you don’t want anyone else to know that idea. You try it just by yourself. But in today’s new Internet age, if you put your ideas right there, other people can come and collaborate. The more I share what I know, the more valuable I become. People have trouble doing that and they have also trouble believing that.&nbsp;</p>
<p style="text-align: justify;">
	<strong><strong>How does your strategy help other organizations?&nbsp;</strong></strong></p>
<p style="text-align: justify;">
	We teach companies how to capture the intellectual capital of the employees in all sorts of makeshift and inefficient repositories so that once a problem is solved, future occurrences of the same or similar problems will be prevented or resolved much faster.&nbsp;</p>
<p style="text-align: justify;">
	<strong><strong>What prospects do you see for your business in Nepal? &nbsp;</strong></strong></p>
<p style="text-align: justify;">
	These are universal problems faced by companies from Wall Street in New York to Kantipath in Kathmandu. We tailor our work to each customer not only to offer services at a good price but also to determine whether or not we think we can add value to our clients.</p>
<p style="text-align: justify;">
	<strong><strong>&nbsp;What are your plans?&nbsp;</strong></strong></p>
<p style="text-align: justify;">
	We have several research projects underway. These projects are about ensuring better client satisfaction during a tech support or services support call. We are also putting together an online site to help make organizational change stick. Change is so difficult to anchor and become “sticky”. We help people make good change take root while helping organizations and businesses prioritize and differentiate between doing the right things and doing things right.</p>',
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			'sub_title' => '',
			'summary' => null,
			'content' => '<p>
	<img alt="Etihad Airways" height="229" src="http://www.newbusinessage.com/ckfinder/userfiles/Images/etihad_airways(1).jpg" width="500" /></p>
<p style="text-align: justify;">
	Etihad Airways, the national airline of the United Arab Emirates, has commenced its new schedule of daily flights between Abu Dhabi and Brisbane via Singapore this week (give the exact date). To mark the occasion, Etihad Airways operated ‘Blue Moon Rising’, its Airbus A330-200 painted in Manchester City Football Club colours on the commemorative February 1 flight. James Hogan, President and Chief Executive Officer of Etihad Airways, said that the new daily service would add an extra 1,048 seats a week to the Abu Dhabi-Singapore-Brisbane route. “The additional capacity puts Etihad Airways in a stronger than ever position in the Singapore and Australian markets. It enables us to compete on a more level playing field than in the past,” said Hogan. He also said that the airline was working closely with government and industry stakeholders in each market to ensure the route’s continuing success.&nbsp;</p>
<p style="text-align: justify;">
	Etihad Airways commenced three weekly flights to Brisbane and Singapore on September 28, 2007. The Queensland capital was the airline’s second destination in Australia and the 43rd in its global network. The airline operates its state-of the-art Airbus A330-200 aircraft on the Abu Dhabi- Singapore-Brisbane route. The aircraft is configured in two classes with 22 seats in Pearl Business Class and 240 seats in Coral Economy Class.&nbsp;</p>
<div style="text-align: justify;">
	 </div>',
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	<img alt="Oman Air" height="152" src="http://www.newbusinessage.com/ckfinder/userfiles/Images/oman_air.jpg" width="150" /></p>
<p style="text-align: justify;">
	Oman Air is offering a Special Companion scheme for Business class for a period of 20 days from February 1 to 20.The airlines has informed that the travel can be completed by 31 May 2013. According to the airline, the customers can avail this offer by contacting their travel agents.</p>',
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			'description' => 'Oman Air is offering a Special Companion scheme for Business class for a period of 20 days from February 1 to 20.',
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			'id' => '880',
			'article_category_id' => '76',
			'title' => 'Beer Ads On Nepali Television? Why Not?',
			'sub_title' => '',
			'summary' => null,
			'content' => '<p>
	<strong style="text-align: justify;">By Abhaya Panday</strong></p>
<p style="text-align: justify;">
	<img alt="Advertising, February 2013" height="190" src="http://www.newbusinessage.com/ckfinder/userfiles/Images/advertising_feb2013.jpg" width="350" /></p>
<p style="text-align: justify;">
	One fine day in 1999 AD, the then His Majesty’s Government decided to ban beer ads on the television. Media reports suggest that it was done under the recommendations of the WHO, the organization which holds immense influence over a poor country like ours. The fact that the same ‘world body’ becomes powerless about the beer ads in countries like the USA is another story altogether. Rumours following the ban also suggested that the decision was made at the behest of a business house which enjoyed monopoly in the country’s beer market. Banning the beer ads on TV would have made it an uphill task for new entrants to increase their market share and thus that ban would have been in the interest of the market leader.&nbsp;</p>
<p style="text-align: justify;">
	But whatever the reasons, apparent or underlying, that is irrelevant. What is important is to question the basis on which the government of the day chose to impose the ban. And why did the party in power, which brands its ideology as the most scientific and revolutionary, choose to continue the legacy of the ‘old regime’? Had the ‘old regime’ conducted a reliable scientific research on the effects of beer ads on its consumption? Let’s forget about a reliable and scientific research for a moment. Did the government conduct any research at all? Nothing suggests that it did. The decision was arbitrary and arbitrariness has become the founding principle of the state in relation to advertising. The latest example of this arbitrariness is the recent decision of one-door policy for government ads.&nbsp;</p>
<p style="text-align: justify;">
	Does the Ministry of Information and Communications (MoIC) possess more expertise in appropriating government ads than the other ministries? Evidence of arbitrariness was seen in the recent past when the Insurance Board decided to curb the spending of insurance companies on their promotional activities, thus negatively affecting the advertising industry. Sometime back, the TV commercial I had made for Digital Cable TV was banned by the MoIC without any clear cut policy on comparative advertising and in the absence of an independent and competent regulatory body on advertising. These are just a few examples which highlight the attitude of the state towards advertising. &nbsp;</p>
<p style="text-align: justify;">
	Let me get back to the ban on beer ads on television. Was it necessary to impose the ban? I don’t think so. Because the assumption that beer advertising results in the increase of overall consumption is unfounded. First, the objective of any advertising exercise is to influence purchase decisions, not to increase the overall consumption. Moreover, in a product category like alcohol that is already widely consumed- in one form or the other- increasing the overall consumption of alcohol is an objective unworthy of pursuit for an advertiser. From the viewer’s perspective, does watching beer ads on TV help the drinker consume more beer than he/she normally does? Or does it entice a non-drinker to have a pint or more? Is advertising the ‘cause’ or the ‘effect’ of alcohol consumption? If the government believes that advertising is the ‘cause’ then perhaps it overestimates the power of advertising. In that case, the government should let the advertising agencies run the nation and by the sheer power of advertising, they shall eradicate all the evils of society. The fact that commercial advertising is mostly the reflection of the society’s values and aspirations and not the cause puts the power of advertising in the proper perspective.&nbsp;</p>
<p style="text-align: justify;">
	Whether beer ads actually increase the overall consumption is an issue that has been raised in the US Parliament more than once. In response, the Federal Trade Commission, The Department of Health and a Senate subcommittee have submitted their reports on different occasions. And their findings suggest a clear absence of correlation between beer advertising and beer consumption. A 21-year long study conducted by Texas University also corroborates the findings. And let’s not forget that we are discussing a country whose per capita alcohol consumption is four times more than that of ours. Some countries in Europe have the figures six times as much, yet beer advertising enjoys considerable freedom in those countries. Of course, the content and placement of beer advertising is regulated and that is what we should be doing in Nepal. Lift the ban on beer advertising on TV and regulate the content and placement. Ironically, the government ignored to impose the ban in the print media, probably under the impression that print advertising is less effective than TV advertising.&nbsp;</p>
<p style="text-align: justify;">
	Is beer drinking good or bad for health? Is moderate drinking medically acceptable or even beneficial? These are medical issues that should be addressed by the medical and health experts. Why do people begin consuming alcohol and, when they do, why do some turn alcoholics? Will we become a better society if we impose a total ban on alcohol? These are different issues altogether. I am neither a medical expert nor a sociologist and nor a psychologist. But as an advertiser, I am led to believe, on the basis of various scientific research conducted in countries where credible scientific &nbsp;research are produced, that advertising of beer on TV does not promote its overall consumption.&nbsp;</p>
<p style="text-align: justify;">
	Advertising, in this view, can only influence the choice of the brand. You may choose to drink beer A instead of beer B, having been influenced by the advertisement of A. But it is most unlikely that you will drink more than what the context allows or, as a non-drinker, you will decide to drink beer A without the psychological need. If the government wants to reduce the consumption of beer or alcohol, then it must address the issues surrounding the psychological and social needs that lead to the consumption of beer or alcoholic products in general. Necessity is not only the mother of invention but also consumption. &nbsp;Kill the enemy, if you can. Don’t kill the messenger.&nbsp;</p>
<p style="text-align: justify;">
	<span style="font-size:11px;">The writer is an advertising professional.</span></p>',
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the founding principle of the state in relation to advertising.',
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			'title' => 'The Pooling Mechanism Is To Stabilize The Insurance Market',
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			'content' => '<p>
	<strong style="color: rgb(35, 200, 250); font-size: 16px; text-align: right;">‘The pooling mechanism is to stabilize the insurance market’</strong></p>
<p>
	<strong><img align="right" alt="Mahendra Shrestha, Himalayan General Insurance" height="301" src="http://www.newbusinessage.com/ckfinder/userfiles/Images/mahendra_cover_feb2013.jpg" style="margin:0 0 0 10px;" width="250" /></strong></p>
<address style="text-align: right;">
	<strong>Mahendra Shrestha</strong></address>
<address style="text-align: right;">
	<strong>Managing Director</strong></address>
<address style="text-align: right;">
	<strong>Himalayan General Insurance</strong></address>
<p style="text-align: justify;">
	 </p>
<p style="text-align: justify;">
	<strong>What is your company’s stake in the aviation insurance market?</strong></p>
<p style="text-align: justify;">
	Himalayan General has been writing aviation insurance since 1998 and it is a portfolio we continue to be interested in.</p>
<p style="text-align: justify;">
	<strong>It is said that some insurance companies are trying to form a pool to collectively handle the aviation insurance claims. What is the latest progress in this regard?</strong></p>
<p style="text-align: justify;">
	Preliminary discussions have been initiated for the formation of aviation insurance pool. The formation of such a pool will not only allow insurance companies to gain capacity but also make it viable for the re-insurers to continue supporting Nepal’s aviation insurance market.</p>
<p style="text-align: justify;">
	<strong>What future do you see for the aviation insurance business in Nepal?</strong></p>
<p style="text-align: justify;">
	It is a portfolio which is an absolute necessity in Nepal and one that will continue to grow.</p>
<p style="text-align: justify;">
	<strong>Aviation insurance premium in Nepal is said to be one among the highest in the world? Why is it so high? How can we lower it?</strong></p>
<p style="text-align: justify;">
	Aviation insurance premium in Nepal is certainly very high. Some big losses in the last few years have pushed up the premium rates substantially. The continually rising premium rates are, of course, a serious concern because they impact the sustainability of the business. The pooling mechanism is one of the possibilities we are exploring in order to stabilize the market. Eventually, if the total premium paid is more than the total amount claimed in losses, we hope the premium will start to come down.</p>
<p style="text-align: justify;">
	What are the key challenges and issues facing the aviation insurance industry in Nepal and what needs to be done to address these challenges?</p>
<p style="text-align: justify;">
	Rising premium rates and shrinking market capacity are two major challenges the aviation insurance industry is currently facing. The Aviation Insurance Summit was one way to address these challenges and find a common direction for improvement and growth.</p>
<p style="text-align: justify;">
	<strong>The country’s first-ever aviation insurance summit was organized in the capital recently. How helpful was this summit?</strong></p>
<p style="text-align: justify;">
	The Summit brought local stakeholders, including operators, regulatory bodies, insurance companies and banks as well as key players in the regional and global aviation insurance industry (including underwriters and re-insurance brokers) under one roof. It gave the Nepali stakeholders a global perspective on our current situation as well as access to the expertise of visiting delegates, all of whom have extensive experience in this sector, including in other countries with contexts similar to Nepal.</p>
<p style="text-align: justify;">
	All the delegates who attended the Summit said that they had found it to be a helpful introduction to the Nepal aviation insurance market, adding that it will help them take better decisions for supporting it.</p>',
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			'title' => 'We Are More Aware About  The Safety Concerns Today Than In The Past',
			'sub_title' => '',
			'summary' => null,
			'content' => '<p>
	<strong style="color: rgb(35, 200, 250); font-size: 16px; text-align: right;">‘We are more aware about the safety concerns today than in the past’</strong></p>
<p>
	<img align="right" alt="Rameshwor Thapa, Airlines Operators Association of Nepal " height="314" src="http://www.newbusinessage.com/ckfinder/userfiles/Images/rameshwor_cover_feb2013.jpg" style="margin:0 0 0 10px;" width="250" /></p>
<address style="text-align: right;">
	<br />
	<strong>Rameshwor Thapa</strong></address>
<address style="text-align: right;">
	<strong>President&nbsp;</strong></address>
<address style="text-align: right;">
	<strong>Airlines Operators Association of Nepal (AOAN)</strong></address>
<p>
	<strong><br />
	</strong></p>
<p style="text-align: justify;">
	<strong>What is the size of the aviation insurance market in Nepal?</strong></p>
<p style="text-align: justify;">
	When talking about the insurance size, the Nepali aviation insurance business is small in global comparison. However, it has an addressable size in the context of the South Asian countries. That means the aviation insurance market in Nepal is neither big nor small but of medium size in terms of money as well as the number of insurers involved in this business. We now pay USD 8 to 9 million in premium to international companies annually.&nbsp;</p>
<p style="text-align: justify;">
	<strong>Why is the aviation insurance premium so high in Nepal? How can we lower it?</strong></p>
<p style="text-align: justify;">
	The re-occurrence of air crashes have contributed to the increment of aviation insurance premium. The open sky aviation policy has helped the mushrooming of airliners in Nepal while the infrastructure remains almost the same. And there may be many issues concerning safety issues. The dramatic increase in premium is also because of the climate and weather. Importantly, trunk route operators have fewer problems in comparison to the STOL (short takeoff and landing) route operators mainly because of the high hills and high altitude. In STOL, mainly in helicopters, there are many instances of accidents beyond what could be conconsidered as normal. &nbsp;</p>
<p style="text-align: justify;">
	Now there are more airports and other facilities which could be rated higher in safety. We are organizing many safety seminars and programmes to lower the premiums with the safety much assured. There have been programmes enhancing the safety measures and we are very much confident that we would be able to enhance safety measures. We are more aware about the safety concerns today than in the past. The audit reports by ICAO and other organizations have diversified it further and made it clear also. Aircraft and passenger safety should be the airliners’ main concern. If we maintain all this - for enhanced safety in the aviation sector - definitely the premium will come down.&nbsp;</p>
<p style="text-align: justify;">
	<strong>There have been more than 50 major accidents in the past 10 years. Why is the frequency of aerial accidents so high in Nepal?&nbsp;</strong></p>
<p style="text-align: justify;">
	It is very sad and bitter fact. The increasing premium in aviation insurance is making it difficult for the airline companies. These days we are trying to improve the security in the aviation sector and are not expecting such accidents again. We are working to reduce such accidents by organizing different seminars and programmes to enhance safety in the aviation sector. Through these safety seminars, we are being able to make the stakeholders aware about air safety. There, we make the pilots aware about focusing on safety while the stakeholders update themselves with different issues and activities in the aviation sector. All the people involved in this sector should understand that not compromising any safety measures but maintaining them will help mitigate the risks. Visual Flight Regulation (VFR) should not be allowed to go through the clouds. &nbsp;If we follow all these safety measures, definitely the risks have to go down. Civil Aviation Authority of Nepal (CAAN) should monitor these flights and instruct accordingly.&nbsp;</p>
<p style="text-align: justify;">
	<strong>The annual claims payout in the aviation insurance has been constantly rising. This is bound to further increase the already significantly high aviation insurance premium. How are we going to tackle this problem?</strong></p>
<p style="text-align: justify;">
	We are concerned about this problem. Basically, if we are able to enhance safety measures, it would help to lower the premium paid out to reinsurance companies. Most of the re-insurers are quite convinced that we would be able to maintain safety properly. End of the Maoist war has also spread positive message to the reinsurers. In the past, we had to pay US$ 60 million premium in third party liability though we owned small aircraft. After knowing the problem, Nepal government addressed this. And now we have to pay some 10 million dollars for the same. The thing is, once we fix the safety problem, the premium will come down.&nbsp;</p>
<p style="text-align: justify;">
	<strong>There are various types of aviation insurance policies in the world. Are all of them available in Nepal?</strong></p>
<p style="text-align: justify;">
	There are not various types of insurance policies in the aviation insurance. The available insurances are air-craft’s insurance, passenger’s insurance, cargo insurance, crew-members insurance- including others. There are insurance policies with same periphery and nature and are normally practiced in other countries as well. Now there are different types of reinsurance market but the problem is they take our situation as an alarming one. I think the situation is not that alarming. Some of the reinsurance companies really want to work and support the Nepali aviation sector which includes Indian as well as western reinsurance companies. A new aviation group in Malaysia is also interested in this business. Moreover the re-insurer companies are not of various types; they are of a singular nature and type.&nbsp;</p>
<p style="text-align: justify;">
	<strong>The country’s first-ever aviation insurance summit was organized in the capital recently. What’s your impression of the summit?&nbsp;</strong></p>
<p style="text-align: justify;">
	It was definitely helpful to us. I think the reinsurance companies that were finding threats in our sky are convinced that the premium which we are paying is not justifiable. We hope that in the coming days they won’t increase the premiums and won’t take our sky as an alarming one for aviation insurance. They got a chance to understand our aviation environment and we had a chance to put the reality in front of them. We were able to prove that there is neither any violence in the country nor any threat in the aviation sector. We were able to prove that we are quite committed to maintaining safety and that we are continuously working on it. We have learnt from past accidents and we are committed to avoiding such accidents.&nbsp;</p>',
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			'description' => 'Most of the re-insurers are quite convinced that we would be able to maintain safety properly. End of the Maoist war has also spread positive message to the re-insurers.',
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			'id' => '870',
			'article_category_id' => '40',
			'title' => 'Now Is The Challenge Of Getting Right Reinsurer At A Competitive Price',
			'sub_title' => '',
			'summary' => null,
			'content' => '<p>
	<strong style="color: rgb(35, 200, 250); font-size: 16px; text-align: right;">‘When the losses start decreasing, the premium will come down’</strong></p>
<p style="text-align: justify;">
	<strong><img align="right" alt="Kewal Krishna Shrestha, Everest Insurance" height="316" src="http://www.newbusinessage.com/ckfinder/userfiles/Images/kewal_cover_feb2013.jpg" style="margin: 0 0 0 10px;" width="250" /></strong></p>
<address style="text-align: right;">
	<strong>Kewal Krishna Shrestha&nbsp;</strong></address>
<address style="text-align: right;">
	<strong>President, Nepal Insurers Association &amp;</strong></address>
<address style="text-align: right;">
	<strong>CEO, Everest Insurance</strong></address>
<p style="text-align: justify;">
	<strong><br />
	</strong></p>
<p style="text-align: justify;">
	<strong>What is the size of the aviation insurance market in Nepal?</strong></p>
<p style="text-align: justify;">
	The market size is around Rs 420- 500 million in terms of the premium we collect from our clients.&nbsp;</p>
<p style="text-align: justify;">
	<strong>What about your company’s stake in the market?</strong></p>
<p style="text-align: justify;">
	We own around 25-30 per cent share in Nepal’s aviation insurance market.&nbsp;</p>
<p style="text-align: justify;">
	<strong>It is said that some insurance companies are trying to form a pool to collectively handle the claims on aviation insurance. Are you aware of the latest progress in this regard?</strong></p>
<p style="text-align: justify;">
	I don’t think the pool is what we need to improve the aviation insurance business. Now we are competing to get the lowest rate from reliable companies (reinsurers) but if such a pool is formed, there would be monopoly in the insurance market and there would be no competition. Insurance companies could syndicate the aviation insurance business and the situation could worsen further. The premium will be at a high rate and the airliners will raise the ticket price which in turn will make air travelling difficult. It seems beneficial to all of us but if we view it minutely it is only a means of syndicating that could affect the whole country economically. &nbsp;</p>
<p style="text-align: justify;">
	However, if such pool is sure to be formed we could form this pool in two ways. One, we can calculate certain risks in the aviation industry and other, we can focus on the risks involved in the hull, baggage etc. However creating such a pool needs lots of vision.&nbsp;</p>
<p style="text-align: justify;">
	Beema Samiti recently organized an interaction programme on the possibilities of merger between &nbsp;insurance companies. This interaction was a good initiation in the insurance business but I think both the government and Beema Samiti should be well prepared on it. It needs lots of homework and researches whether to form a pool or to merge the insurance companies.&nbsp;</p>
<p style="text-align: justify;">
	<strong>What future do you see for the aviation insurance business in Nepal?</strong></p>
<p style="text-align: justify;">
	The prospects of aviation business in Nepal depend on the growth of the airliners. The more airlines are there, the better for the aviation insurance business. The theory of demand and supply is applied in the aviation business also. Many airlines are not functioning well and some of them have registered but have not started their operation yet. If new airliners start operating it would benefit both the airliners and the aviation industry. &nbsp;Development of airports and runways in a sustainable way can also sustain airliners. And the development of airliners ultimately grows the aviation insurance business. Since there is a lot of prospects in the tourism sector, I see bright future of aviation insurance business.&nbsp;</p>
<p style="text-align: justify;">
	<strong>Aviation insurance premium in Nepal is said to be one among the highest in the world? Why is it so high?</strong></p>
<p style="text-align: justify;">
	No, I disagree with this. We used to pay 8-9 per cent premium some 10 years ago and we were able to reduce that as low as 2 per cent later. Now again the reinsurance companies are charging the same old rate or even higher. It is mainly because of the risk factors in the aviation industry of Nepal and I don’t think it is unjustifiable. The terrain, safety measures in the aviation industry in Nepal and lack of maintaining safety standards by all the stakeholders involved in the aviation industry are some of the reasons behind the increment of premium. We lack the standard safety measures in spite of ICAO advice.&nbsp;</p>
<p style="text-align: justify;">
	<strong>What do you expect from the Beema Samiti or the government for that matter to facilitate the aviation insurance business in the country? &nbsp;</strong></p>
<p style="text-align: justify;">
	The government can enforce the safety standards. It can properly manage the runways, ground handling, and certify efficiency of the people and the equipment used in the aircraft or for the aircraft maintenance. If you see how the baggage in airports is handled, you will find how improperly things are done. The baggage is loaded in tractors and the insurer has to pay if there is a damage. Furthermore, the international airport in Nepal is very crowded. I think the TIA should now be shifted to some convenient place.&nbsp;</p>
<p style="text-align: justify;">
	<strong>What are the key challenges and issues facing the aviation insurance industry in Nepal?</strong></p>
<p style="text-align: justify;">
	Now is the challenge of getting the right reinsurer at a competitive price. The aviation business is anyway running though the reinsurers are charging up to 12 per cent. But what if they charge 20-25 per cent? I don’t think aviation in Nepal could bear such high premium rates. Moreover, the environment could be such that even the high premium might not draw reinsurers into confidence. Because of the high risk involved in this business, the reinsurers could add more clauses which could affect the overall aviation business in Nepal. And then it will be hard to find reliable reinsurers and we will have to reinsure with whichever party we find. When the claim increases, the premium market becomes hard and reinsurers hesitate to do business. And aviation insurance is driven by reinsurers. Unless the scenario of this seller-driven market changes, we won’t have any other alternative.&nbsp;</p>
<p style="text-align: justify;">
	<strong>What needs to be done to address these challenges?</strong></p>
<p style="text-align: justify;">
	CAAN has to be strong. All the stakeholders of the aviation industry should maintain the safety standards prescribed by ICAO in terms of physical amenities, ground handling, aircraft maintenance, tracing of the aircraft personnel etc. Maintaining the safety standard is the foremost requirement. Everybody in the aviation industry should strictly follow the policies and run under rules and regulations of the government. &nbsp;</p>
<p style="text-align: justify;">
	<strong>The annual claims payout in the aviation section has been constantly rising. This is bound to further increase the already significantly high aviation insurance premium. How are we going to tackle this problem?</strong></p>
<p style="text-align: justify;">
	This is not a problem; it’s an outcome which is natural. When claims payout in the aviation sector starts increasing, increment in the premium is normal internationally. &nbsp;And when the claims start rising, the party is affected and slowly it affects other airliners. When the risk is found the reinsurer loads the premium and that is considered normal in the insurance business.&nbsp;</p>
<p style="text-align: justify;">
	When safety measures are properly followed the risk has to go down. For this, all the stakeholders in the aviation industry should come together and contribute. &nbsp;Evaluation of our work and adopting things that make this business ideal as well as searching ways of perfection in the aviation business is a must.&nbsp;</p>',
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			'description' => 'Now we are competing to get the lowest rate from reliable companies (reinsurers) but if such a pool is formed, there would be monopoly of the insurance companies and there would be no competition.',
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			'id' => '869',
			'article_category_id' => '40',
			'title' => 'When The Losses Start Decreasing, The Premium Will Come Down',
			'sub_title' => '',
			'summary' => null,
			'content' => '<p>
	<strong style="color: rgb(35, 200, 250); font-size: 16px; text-align: right;">‘When the losses start decreasing, the premium will come down’</strong></p>
<p>
	<img align="right" alt="Pronab Sen, National Insurance Company Ltd" height="317" src="http://www.newbusinessage.com/ckfinder/userfiles/Images/pronab_cover_feb2013.jpg" style="margin: 0 0 0 10px;" width="250" /></p>
<address style="text-align: right;">
	<strong>Dr Pronab Sen&nbsp;</strong></address>
<address style="text-align: right;">
	<strong>Chief Executive Officer,&nbsp;</strong></address>
<address style="text-align: right;">
	<strong>Nepal</strong><strong>National Insurance Company Ltd</strong></address>
<p>
	 </p>
<p style="text-align: justify;">
	<strong>What is your company’s stake in the aviation insurance portfolio?</strong></p>
<p style="text-align: justify;">
	We are moving very selectively in the aviation insurance in Nepal. Previously, Guna Air was 100 per cent with us and now Simrik Air has taken it over. There are some airliners which are having reinsurance support from our corporate office in India- like Buddha Air. We have around five percent market share in the aviation portfolio. Agni Air is co-insured with Shikhar Insurance – 60 percent with them and 40 per cent with us. Another airline in Pokhara has insured 49 per cent with us and 51 per cent with Shikhar. We are now negotiating with Simrik because Guna was with us. &nbsp;</p>
<p style="text-align: justify;">
	We are the direct branch of a reinsurance company in India governed by the Indian Government. We have high retention capacity. We reinsure the portion to other reinsurance companies that is beyond our financial strengths. This is a worldwide phenomenon in insurance business. It depends on portfolios and varies from risk to risk. Sometimes, we retain 20 per cent and sometimes 90- depending on the risks.</p>
<p style="text-align: justify;">
	<strong>Is it true that the insurance companies in Nepal have not been able to make profits from aviation insurance? Why?</strong></p>
<p style="text-align: justify;">
	Yes it is true. And the reason is there are a number of airliners which are very small in size. It may be also because of the weather and terrain of Nepal. Small airliners and aviation companies do not afford expertise and there are few airliners where I have seen the full expertise – this is the biggest challenges for the Nepali aviation sector. Many of the aircraft are also very old. &nbsp;</p>
<p style="text-align: justify;">
	Some of the insurance companies have retention capacity of 0.4 per cent and rest is reinsured. These companies are getting only the reinsurance commission. &nbsp;</p>
<p style="text-align: justify;">
	<strong>Some insurance companies are trying to form a pool to collectively handle the aviation insurance claims. What is your view on this proposal?</strong></p>
<p style="text-align: justify;">
	It is still in the pipeline. Nothing concrete has come out so far. But if such a pool is formed, it will help both the aviation insurers as well as the airliners. After the formation of the pool, they don’t have to run around different countries trying to find out the lowest rate. Once the pool is formed, they know that they have to approach only one office which will organize everything. And the office will be the consortium of a number of insurance companies.&nbsp;</p>
<p style="text-align: justify;">
	<strong>What future do you see for aviation insurance business in Nepal?</strong></p>
<p style="text-align: justify;">
	The future is good because there is a tremendous growth in the tourism sector in Nepal. The tourism sector has a tremendous scope and the more this sector grows, the more the aviation sector expands. More people prefer to travel by air in Nepal considering the time taken in travelling by roads. By air you reach Pokhara in 20-25 minutes.But if you take a bus, it takes 5- 6 hours. And the growth of airliners has paved the road for growth of the aviation insurance companies.&nbsp;</p>
<p style="text-align: justify;">
	<strong>Almost whatever the insurance companies earn from the aviation segment goes to the reinsurance companies abroad. Some are even said to be making losses in the aviation segment. It is said that the companies know that they are not going to make profits from the aviation segment. But they do aviation insurance just to show high insurance premium collection. What do you say?</strong></p>
<p style="text-align: justify;">
	It is not like that. The premium is based on the past losses. If you see the statistics, almost every year there is an air crash and some years, there are around two air crashes in Nepal. And the rate of premium is governed by the reinsurance market. Because of the air accidents, some of the reinsurers were hesitant to do business in Nepal. The aviation summit last month also put forth lots of similar issues in the aviation industry- the dos and the don’ts. Beyond that, the aviation business has a very bright future.&nbsp;</p>
<p style="text-align: justify;">
	<strong>Aviation insurance premium in Nepal is said to be one among the highest in the world? Why is it so high?</strong></p>
<p style="text-align: justify;">
	Yes. As I already said, insurance premiums are based on the past losses. Because of the crashes, the premium has been rising. The recent crashes of Sita Air and Agni Air were a serious concern for the reinsurers.&nbsp;</p>
<p style="text-align: justify;">
	<strong>Are those high premium rates justifiable?&nbsp;</strong></p>
<p style="text-align: justify;">
	The loss is calculated based on the coverage offered by the insurance companies. Suppose there is a loss. You pay some percent of the loss. You pay for the hull losses and the machinery parts or you pay for the passenger liabilities. Passenger liability losses are much higher than the hull losses depending on the kind of passengers. The liability losses are much higher if the passengers are from the US or Canada, and lower if they are from the SAARC countries. The liability losses vary from people to people because of theirs living standard. While finalizing the rates, reinsurers study these things.&nbsp;</p>
<p style="text-align: justify;">
	Airliners not only fly Nepali people or SAARC people but also other foreigners. For example, most of the people in the mountain flights are from European countries. Furthermore, airliners have different premiums depending on their types, aircraft, and management facilities they have.&nbsp;</p>
<p style="text-align: justify;">
	<strong>How can we lower the high insurance premium?</strong></p>
<p style="text-align: justify;">
	It’s a million dollar question. It has to be high, otherwise it won’t be viable. We are not totally dependent on our own companies. We may not have the capacity, so we need to approach other markets for reinsurance. When the losses start decreasing, the premiums will simultaneously come down. For example in India, the fire premium rate was very high in the past. Many studies were conducted. And when they calculated the total premium over a period of time, and how much profit they generated- then the premium started coming down. Likewise, though the premium is high at the moment, it will definitely go down every year if the risk is reduced. In the present scenario, you don’t have any choice. Until the reinsurer accepts the business, how can you reinsure?</p>
<p style="text-align: justify;">
	<strong>The country’s first-ever aviation insurance summit was organized in the capital recently. How helpful was this summit?</strong></p>
<p style="text-align: justify;">
	I think it was helpful. We got to know the perspectives of different reinsurers present there. It was the first of its kind event in Nepal and was helpful for everyone involved in the aviation industry.&nbsp;</p>',
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			'description' => 'We have high retention capacity. We re-insure the portion to other reinsurance companies that is beyond our financial strengths.',
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			'id' => '868',
			'article_category_id' => '40',
			'title' => 'Unhealthy Competition Among The Insurance Companies Should Be Stopped',
			'sub_title' => '',
			'summary' => null,
			'content' => '<p>
	<span style="color:#23c8fa;"><span style="font-size: 16px;"><strong>‘Unhealthy competition among the insurance companies should be stopped’</strong></span></span></p>
<p>
	<strong><img align="right" alt="Prem Bahadur Maharjan, Rastriya Beema Sansthan" height="307" src="http://www.newbusinessage.com/ckfinder/userfiles/Images/prem_cover_story_feb2013.jpg" style="margin:0 0 0 10px;" width="250" /></strong></p>
<address style="text-align: right;">
	<strong>Prem Bahadur Maharjan&nbsp;</strong></address>
<address style="text-align: right;">
	<strong>Chairman</strong></address>
<address style="text-align: right;">
	<strong>Rastriya Beema Sansthan</strong></address>
<div>
	 </div>
<p style="text-align: justify;">
	<strong>What is your company’s stake in the aviation insurance market?</strong></p>
<p style="text-align: justify;">
	The amount of insurance is calculated in foreign currency. We own around USD 2 million business which constitutes 30 to 40 per cent of the total aviation insurance business. We are the only insurance company insuring big aircraft including jet planes. We have insured the Jet planes of the national flag carrier, Nepal Airlines, and BB Airways lately. We have succeeded in acquiring the largest proportion of insurance share in the market because national airlines is insured with us. &nbsp;&nbsp;</p>
<p style="text-align: justify;">
	<strong>Is it true that the insurance companies have not been able to make profits from aviation insurance? Why?</strong></p>
<p style="text-align: justify;">
	I don’t agree with this. &nbsp;In our case, we feel that there is some harsh competition including in the premium rates. And particularly in the private airlines sector, we have witnessed a number of air crashes. That might have contributed to the loss in the overall aviation insurance business but it is not the case of Beema Sansthan. We have not gone through such loss. Nor &nbsp;have our clients faced such air crashes.&nbsp;</p>
<p style="text-align: justify;">
	<strong>Some insurance companies are trying to form a pool to collectively handle the claims on aviation insurance. When could we see such a pool?</strong></p>
<p style="text-align: justify;">
	I have also heard about it. I guess the practice of collectively handling the aviation insurance claims is yet to materialize. It would be good if such a pool is formed. It will help prevent unhealthy competition.&nbsp;</p>
<p style="text-align: justify;">
	<strong>What future do you see for aviation insurance business in Nepal?</strong></p>
<p style="text-align: justify;">
	I see a lot of potential for this business. &nbsp;The aviation market has grown in Nepal over the years and with it, the aviation insurance business, too, has grown. The other big reason is that Nepal is promoting tourism by organizing many events. This has increased the number of air passengers to Nepal and thus helped the aviation insurance in the country.&nbsp;</p>
<p style="text-align: justify;">
	<strong>Almost whatever the insurance companies earn from the aviation segment goes to the reinsurance companies abroad. Some are even said to be making losses in the aviation segment. It is said that the companies know that they are not going to make profits from the aviation segment. But they do aviation insurance just to show high insurance premium collection. What do you say?</strong></p>
<p style="text-align: justify;">
	In a way, it is true. Since we don’t have a strong financial institution that can cover the aviation insurance, we depend on foreign reinsurance companies. Though the percentage of commission from premium collection that we collect seems minimal, we are able to sustain the operation. Though the commission might be less in comparison to the bigger amount of insurance premium; we have other indirect benefits as well. It is because we have to reinsure &nbsp;with very reliable reinsurance companies recognized internationally. There are very few reliable reinsurance companies. Beema Sansthan has found a re-insurer based in the United Kingdom.&nbsp;</p>
<p style="text-align: justify;">
	<strong>What do you expect from the Beema Samiti or the government for that matter to facilitate the aviation insurance business in the country? &nbsp;</strong></p>
<p style="text-align: justify;">
	There is unhealthy competition among the insurance companies at present. They tend to take the aviation insurance business at low rates ignoring the risk factors. The situation is such that some companies might collapse if something bad happens to the airlines they have insured. Moreover, I have heard that some insurance companies are even unable to pay out the claims. Beema Samiti, being the regulatory body, can set some standards to avoid such kind of unhealthy competition. Beema Sansthan is a government-owned institution. So, it does not need to jump into this unhealthy competition. Though aviation insurance is growing, almost all the premium collected here goes abroad. We get only a fraction of it as commissions. I think this is the time that Beema Samiti should form a government-owned re-insurance company in Nepal. It will help us to stop or decrease the amount of money going outside the country.&nbsp;</p>
<p style="text-align: justify;">
	<strong>What are the key challenges and issues facing the aviation insurance industry in Nepal?</strong></p>
<p style="text-align: justify;">
	As I already mentioned, the first challenge is unhealthy competition among some insurance companies. The risk factor is also growing and it is making premiums costlier. We have witnessed many air crashes in a quite short period of time. It is not only about insurance, it is also about the safety of the people.&nbsp;</p>
<p style="text-align: justify;">
	<strong>What needs to be done to address these challenges?</strong></p>
<p style="text-align: justify;">
	There has to be a strict monitoring mechanism for air traffic discipline. People involved in the aviation business should be given safety education. Pilots should also be alerted not to take any sort of risks.&nbsp;</p>
<p style="text-align: justify;">
	Moreover, unhealthy competition among the insurance companies should be stopped. And it could be managed since there are very limited insurance companies in the aviation sector. Furthermore, the government should try to establish reinsurance companies here in Nepal itself.</p>
<p style="text-align: justify;">
	<strong>The country’s first-ever aviation insurance summit was organized in the capital recently. How did you find this summit?</strong></p>
<p style="text-align: justify;">
	From educational point of view, the summit was quite fruitful to the people involved in the aviation insurance sector. It was successful in raising the issues related to the risk factors in the aviation insurance and about the premiums that are in practice. Such summits are helpful in making people aware about the things happening in the aviation insurance market. I expect such events to continue.&nbsp;</p>',
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			'description' => 'The first challenge is unhealthy competition among some insurance companies.The risk factor is also growing and it is making premiums costlier.',
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		'Article' => array(
			'id' => '867',
			'article_category_id' => '40',
			'title' => 'Airclaims Is A Major Resource For Nepali Civil Aviation',
			'sub_title' => '',
			'summary' => null,
			'content' => '<address>
	<strong style="text-align: right;"><font color="#23c8fa" size="3"><span style="font-style: normal;">‘Airclaims is a major resource for Nepali civil aviation’</span></font></strong></address>
<address>
	<strong style="text-align: right;"><font color="#23c8fa" size="3"><span style="font-style: normal;"><br />
	</span></font></strong></address>
<address>
	<strong>Douglas G Cavannagh</strong></address>
<address>
	<strong>Risk and Safety Manager</strong></address>
<address>
	<strong>Airclaims&nbsp;</strong><strong>(A UK-based leading reinsurance company)</strong></address>
<p style="text-align: justify;">
	<strong><br />
	</strong></p>
<p style="text-align: justify;">
	<strong>How long has your company been involved in the insurance business in Nepal?&nbsp;</strong></p>
<p style="text-align: justify;">
	Airclaims is the leading provider of claims, risk management and asset management services to the global aviation industry. Founded in 1964 Airclaims has been handling aviation insurance claims in Nepal since the late 1960s. Airclaims currently handles in excess of 2500 assignments each year though a global network of 20 offices. Airclaims is the leading provider of such expertise worldwide.&nbsp;</p>
<p style="text-align: justify;">
	In terms of Airclaims risk and safety consulting services this service offering was initially utilised by aviation insurance underwriters to assess the risk profile of different operators. The initiation of these studies was often a consequence of a serious accident or a deteriorating loss record on the part of an operator.&nbsp;</p>
<p style="text-align: justify;">
	As our capability grew these services were expanded to include risk and safety assessments of maintenance, repair and overhaul facilities, helicopter operators, ground handling companies and airports. During the past 20 years many of these services have also been utilised by petroleum and mining companies who use our expertise to assess the risk of different contractors that they use. Airclaims is now one of the leading providers of operator risk assessments in this sector. Our experience is often in demand from investors who require a bespoke due diligence study to assist them to better understand the risks associated with a potential acquisition and to provide valuations and condition surveys of aircraft to potential purchasers or those who wish to update the value of their aviation assets. We also undertake a considerable amount of work for airlines and operators who require a completely impartial assessment of their operation and a worldwide perspective to help them improve their own internal safety capability. This ranges from the initial assessment and needs analysis, to project management, training, coaching and final assessment.&nbsp;</p>
<p style="text-align: justify;">
	In today’s challenging asset management environment, the demand is for a business partner that not only has a strong reputation and broad capability but also the consistency of approach.&nbsp;</p>
<p style="text-align: justify;">
	Our integration of what are typically considered separate functions, such as project management, airworthiness oversight, powerplant services and risk management are all combined to form ten core modules, providing a unique capability&nbsp;</p>
<p style="text-align: justify;">
	<strong>How do you differentiate yourself from other companies?</strong></p>
<p style="text-align: justify;">
	We differentiate ourselves by:&nbsp;</p>
<ul>
	<li style="text-align: justify;">
		Drawing on ‘real world’ experience gained from our involvement in the aftermath of many of the largest aviation accidents and losses during the past 50 years.&nbsp;</li>
	<li style="text-align: justify;">
		Being able to recommend bespoke solutions to mitigate risk based on our work with all the different parties involved in aviation, not just airlines and operators.&nbsp;</li>
	<li style="text-align: justify;">
		Using our international experience gained from working with many different nationalities and cultures, to train and coach organisations on how to achieve the same objectives using alternative methods.&nbsp;</li>
	<li style="text-align: justify;">
		Using our exposure to accident sites and our knowledge of emergency response services to tailor procedures to the reality of what actually happens during these events.&nbsp;</li>
</ul>
<p style="text-align: justify;">
	<strong>The size of your business in Nepal at present?&nbsp;</strong></p>
<p style="text-align: justify;">
	That really depends on how often there is an accident. Unfortunately for some that has been a little too often. If there was to be a reduction in the number of accidents as a result of Airclaims providing Risk Management rather than Claims Management Services then that would be fine with us too. We are currently the preferred aviation claims handling company for the national airline and a number of domestic operators in Nepal and also most International carriers who operate services to Kathmandu. Our presence in Nepal over many decades has enable Airclaims to build up much valued relationships.&nbsp;</p>
<p style="text-align: justify;">
	<strong>Why is the insurance premium in aviation so high in Nepal?&nbsp;</strong></p>
<p style="text-align: justify;">
	There are a number of factors that affect the rate at which the insurance premium is calculated in any market. Some of those factors are loss record, operating environment and the type and value of the aircraft being insured.&nbsp;</p>
<p style="text-align: justify;">
	Nepal is undoubtedly a challenging operating environment for operators and crews in terms of terrain, weather and infrastructure and these factors do mean that along with a loss record that reflects these challenges, insurance costs will be higher. However, with improvements in infrastructure, training and operations, it is quite possible to address many of these factors and in doing so ensure that the cost of insurance is maintained at a reasonable level.&nbsp;</p>
<p style="text-align: justify;">
	There is also the factor of insurance market capacity something which cannot be directly influenced in Nepal. Worldwide, it could be said that there is a good deal of capacity i.e. insurers who want to underwrite aviation risks. Capacity and competition help keep the price down although, Nepal is seen as a higher risk region because of the factors already mentioned above.&nbsp;</p>
<p style="text-align: justify;">
	We know that all parties involved in aviation in Nepal are keen to support the improvements that are needed to ensure risk is reduced and Airclaims are ready to play its part in the provision of not just loss management services but also risk management services.&nbsp;</p>
<p style="text-align: justify;">
	<strong>What are the challenges faced by the aviation insurance business in Nepal?&nbsp;</strong></p>
<p style="text-align: justify;">
	The challengers faced by the aviation insurance business in Nepal are the challenges that face the aviation operators as well. The biggest challenge is to reduce operational risk. Despite the significant challenges that are faced, Nepal is clearly serious in its desire to reduce risk and consequently improve safety. It can be done.&nbsp;</p>
<p style="text-align: justify;">
	The main challenges facing aviation in Nepal are:&nbsp;</p>
<ul>
	<li style="text-align: justify;">
		Infrastructure improvement. There needs to be a significant investment in better basic airport facilities (i.e. runways, navigation aids, etc.)&nbsp;</li>
	<li style="text-align: justify;">
		Weather reporting. There is a requirement for a significant number of automatic weather stations to report the weather being experienced in real time, via satellite link, in the more remote parts of the country.&nbsp;</li>
	<li style="text-align: justify;">
		Better operational control being exercised by the operators. It needs to become a complete team effort especially when difficult decisions are needed associated with dispatch of aircraft in the difficult operational environment that exists.&nbsp;This will become even more important over the next decade or so as the average age and experience levels of pilots are reduced.&nbsp;</li>
	<li style="text-align: justify;">
		More and better training to help reduce the effect of the loss of highly experienced pilots over the next ten years.&nbsp;</li>
</ul>
<p style="text-align: justify;">
	<strong>What can Nepal do to overcome these challenges?&nbsp;</strong></p>
<p style="text-align: justify;">
	The system of regulation that has been in place for the past 50 plus years may have reached its maximum effectiveness. Regulation by requiring compliance with rules and regulations has probably got as good as it will get globally. The adoption of a more proactive and predictive Safety Management System (SMS) is needed by the operators and aviation authorities in Nepal. Having an effective way of safety oversight such as through adoption of a Safety Management System (SMS) has been proved to improve safety and risk management culture. Such a system can be used to support airline owners, airline managers, pilots &amp; engineers and all who are involved in aviation; this includes the regulators who must have a key role in supporting new ways of looking at risk and safety management and oversight.&nbsp;</p>
<p style="text-align: justify;">
	<strong>The annual claims payout in the aviation section has been constantly rising. This is bound to further increase the already significantly high aviation insurance premium. How are we going to tackle this problem?&nbsp;</strong></p>
<p style="text-align: justify;">
	The current global picture is interesting with record low levels of claims for successive years. Unfortunately this trend has not been seen in Nepal. Tackling the problem will require leadership on the part of the regulating authorities towards resetting the scene for risk and safety management such as through improvement in the operational management operators. The regulating authorities can and need to play a leading role in improving oversight and ensuring that all operators are able to take advantage of an open and even handed approach to improvement of infrastructure and operational standards. Operators investing in good safety systems and management should be supported and those that are failing to do this need to be provided with proper advice and if necessary some forms of sanction up to and including withdrawal of AOC.&nbsp;</p>
<p style="text-align: justify;">
	New approaches and thinking will bring positive benefits. We can’t just keep doing business as we have always done and expect things to get better on their own. Change is inevitable in all businesses not least aviation and the benefits to Nepal can be significant in terms of social and economic reward.&nbsp;</p>
<p style="text-align: justify;">
	<strong>What prospects do you see for aviation insurance business in Nepal in the future?&nbsp;</strong></p>
<p style="text-align: justify;">
	The prospects for aviation insurance business in Nepal are bright. There is a capable and knowledgeable local market which has good relationships with the global insurance community. The present level of risk is too high but there are enough insurers willing to support the market, albeit currently at a higher cost than in some other places. What is perceived as the current high cost of insurance can and should be reduced for operators who demonstrate a good safety culture and record, adopt a Safety Management Programme that is working well and can prove that it is making a difference.&nbsp;</p>
<p style="text-align: justify;">
	<strong>Is there anything else that you would like to say?&nbsp;</strong></p>
<p style="text-align: justify;">
	As a leading provider of Claims Handling and Risk and Asset Management Services and with our long association with Nepal aviation, Airclaims can help make a safer environment for all stakeholders in aviation in Nepal, but it has a cost. Therefore, we are ready to work with the leaders of aviation in Nepal to support Nepal in the development of its aviation capability and ambitions with safety as the focus of any plan. Once it happens all of Nepalese society will reap the benefits.&nbsp;</p>',
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	(int) 7 => array(
		'Article' => array(
			'id' => '866',
			'article_category_id' => '40',
			'title' => 'Sky Is The Limit For Aviation Insurance In Nepal',
			'sub_title' => '',
			'summary' => null,
			'content' => '<p style="text-align: justify;">
	<img align="right" alt="Prakash Panday, Shikhar Insurance Company Ltd" height="276" src="http://www.newbusinessage.com/ckfinder/userfiles/Images/prakash_panday_cover_feb2013.jpg" style="margin: 0px 0px 0px 10px;" width="235" /></p>
<address style="text-align: right;">
	<strong style="color: rgb(35, 200, 250); font-size: 16px; font-style: normal;">‘Sky is the limit for aviation insurance in Nepal’</strong></address>
<address style="text-align: right;">
	 </address>
<address style="text-align: right;">
	<strong>Dip Prakash Panday</strong></address>
<address style="text-align: right;">
	<strong>CEO</strong></address>
<address style="text-align: right;">
	<strong>Shikhar Insurance Company Ltd</strong></address>
<p>
	 </p>
<p style="text-align: justify;">
	<strong>What is the size of the aviation insurance market in Nepal?</strong></p>
<p style="text-align: justify;">
	The total size of the aviation insurance market of the domestic private sector in Nepal is around USD 8.5 -9 million.&nbsp;</p>
<p style="text-align: justify;">
	<strong>What about your company’s stake in the market?</strong></p>
<p style="text-align: justify;">
	We have around 70-75% market share.</p>
<p style="text-align: justify;">
	<strong>Is it true that the insurance companies have not been able to make profits from the aviation insurance? Why?</strong></p>
<p style="text-align: justify;">
	Aviation Insurance in Nepal has been a loss making portfolio for all the insurers involved. &nbsp;This has been because of the losses in the last couple of years. Nepal is being taken as a high risk zone for aviation insurance.&nbsp;</p>
<p style="text-align: justify;">
	<strong>It is said that some insurance companies are trying to form a pool to collectively handle the aviation insurance claims. What is the latest progress in this regard?</strong></p>
<p style="text-align: justify;">
	It is a very good concept. Reinsurance companies support about 99.5 per cent insurance and only 0.5% is handled by the local insurance companies. The main idea behind forming this pool is to take the advantage of the volume and also to get quality reinsurers so that losses get paid in a timely manner and also to have standardization in all the policies. &nbsp;This can also help in some investment in safety features.&nbsp;</p>
<p style="text-align: justify;">
	<strong>How is this pool going to help the insurance companies, if and when it is formed?</strong></p>
<p style="text-align: justify;">
	It is still in the planning process. Insurance companies and operators have to come together with full support from the regulators before such a pool can be formed. &nbsp;</p>
<p style="text-align: justify;">
	<strong>What future do you see for aviation insurance business in Nepal?</strong></p>
<p style="text-align: justify;">
	Sky is the limit for aviation insurance in Nepal. The only thing is that safety factors have to be improved. Nepal’s aviation sector is classified as the highest risk zone for reinsurers. We want to see Nepal as a safe destination. When a pool of insurers is going to own the overall aviation insurance, more responsibility shall be felt. Risk management is very important.&nbsp;</p>
<p style="text-align: justify;">
	<strong>Almost whatever the insurance companies earn from the aviation segment goes to the reinsurance companies abroad. Some are even said to be making losses in the aviation segment. It is said that the companies know that they are not going to make profits from the aviation segment. But they do aviation insurance just to show high insurance premium collection is. What do you say?</strong></p>
<p style="text-align: justify;">
	We are not sending money, we are transferring risk. The reason that the companies are still in profit is because the money is flowing in from the reinsurers abroad. Since they agreed to take the risk, they bear the losses as well. But after eight consecutive years of losses, they are getting scared. Some of the reinsurers have already withdrawn from the Nepali aviation market.</p>
<p style="text-align: justify;">
	<strong>How can we lower the high insurance premium?</strong></p>
<p style="text-align: justify;">
	It will take time. It is important to win the confidence of the reinsurers and prove that Nepal’s aviation sector is a safe zone for investment. This can be done only by reducing the losses. Fear is a very dangerous thing. Our terrains are difficult, which has sent a wrong perception. Similarly, loss is also a perception and this can be changed. All we need is 2 to 3 years of good loss ratio.&nbsp;</p>
<p style="text-align: justify;">
	<strong>What do you expect from the Beema Samiti or the government for that matter to facilitate the aviation insurance business in the country? &nbsp;</strong></p>
<p style="text-align: justify;">
	It would be great if the Beema Samiti would help in the process of making an Aviation Pool. Active participation and support is required from them and the Civil Aviation Authority of Nepal (CAAN), especially on the safety side. This should not be only on papers but also in practice.&nbsp;</p>
<p style="text-align: justify;">
	<strong>What are the key challenges and issues facing the aviation insurance industry in Nepal?</strong></p>
<p style="text-align: justify;">
	CAAN has to take the lead role. CAAN and the private airline operators should be more alert. There should be an improvement in monitoring flight data, safety infrastructure etc. For example, many airports in Nepal are not black-topped. When the weather is bad, flights should be aborted and airports should be closed. Individual behavior should be monitored by the operators. We also need to invest in training and skill development of the people involved in the aviation business.&nbsp;</p>
<p style="text-align: justify;">
	<strong>The annual claims payout in the aviation section has been constantly rising. This is bound to further increase the already significantly high aviation insurance premium. How are we going to tackle this problem?</strong></p>
<p style="text-align: justify;">
	There should be a considerable investment in safety measures. I feel that the only way out now is to produce good results for the reinsurers. Losses do happen but the frequency of losses in our country is high. If we go jointly, I feel that this will be a good beginning and we can produce significant results. &nbsp;</p>
<p style="text-align: justify;">
	<strong>There are various types of aviation insurance policies in the world. Are all of them available in Nepal?</strong></p>
<p style="text-align: justify;">
	Three basic types of aviation products are available in Nepal. These are basically for Hull, Liability including Passengers and Crew Personnel Accident and Hull War. Hull insurance covers the insurance of aircraft. Till last year, Combined Single Limit Liability insurance required was USD 60 million per aircraft which has now been revised. Hull War insurance is used in case of war, hijacking etc. &nbsp;</p>
<p style="text-align: justify;">
	<strong>The country’s first-ever aviation insurance summit was organized in the capital recently. How helpful was this summit?</strong></p>
<p style="text-align: justify;">
	Reinsurers came to the market and studied it. Their perception has changed. We took them to see our infrastructures including a mountain flight and had discussions on the current issues of the aviation market. We are trying our best to boost the reinsurers’ confidence. We feel that the summit has helped to bring some positive change in their risk perception of our country.</p>
<div style="text-align: justify;">
	 </div>',
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			'id' => '865',
			'article_category_id' => '39',
			'title' => 'NICL : Three Decades Of Insurance',
			'sub_title' => '',
			'summary' => null,
			'content' => '<p>
	<img alt="National Insurance Company Limited (NICL)" height="60" src="http://www.newbusinessage.com/ckfinder/userfiles/Images/corporate_focus_feb2013.jpg" style="text-align: justify;" width="210" /></p>
<p style="text-align: justify;">
	National Insurance Company Limited (NICL) is a Government of India Undertaking and is operating in Nepal since 1973. NICL completed 106 years on 6th December 2012 and is into the 107th year of operation. Prior to nationalisation in India in 1972, it was operating as a private company. In 1972, at the time of nationalisation of Non Life Insurance Sector in India, there were 106 companies operating in India and later on, 22 Foreign and 11 Indian private companies were merged to form National Insurance Company Limited.</p>
<p style="text-align: justify;">
	National Insurance Company Limited (NICL) had hardly any competitions at the time of establishment, three decades back in Nepal. Now the company is facing a cut throat competition from 17 non life insurance companies in the Nepali market.&nbsp;</p>
<p style="text-align: justify;">
	The stiff competition does not deter the company from having its strong foothold in the market. NICL believes and enjoys working on a competitive environment. “We welcome competition in the insurance field. We strongly feel that competition is must to ensure prompt services to clients and it is good for the customers as they can look forward to better services,” said Dr Pronab Sen, Chief Executive Officer (CEO) of the company’s Nepal operations. However, the competition is mostly in the service front since most of the portfolios are tariff products and the rates are fixed by the regulators, so the competition is almost none on the premium rate front.</p>
<p style="text-align: justify;">
	<strong>Market Potentials</strong></p>
<p style="text-align: justify;">
	Though the competition has heightened much, insurance business has not been able to penetrate deep enough into the insurance market. Sen said that the penetration level is just 0.55 per cent. Therefore, the company sees huge untapped market potentials available.&nbsp;</p>
<p style="text-align: justify;">
	“I strongly feel that the non life insurance business can be increased many folds in Nepal as the awareness level is very low and we need to create insurance awareness among masses,” said Sen. Even though the Nepali insurance market has seen many players for the last three decades, still the awareness level lies low. The insurance market has not developed much during this time span. Sen feels that there is a need to recruit agents, who can propagate the message of insurance among the masses and make people understand the need of insurance. He believes that this could be the means to create indirect employment.</p>
<p style="text-align: justify;">
	Amid the competitive environment, the NICL has come up by leaps and bounds. Dr Sen said, “We have grown many folds in terms of business, manpower and networking.”</p>
<p style="text-align: justify;">
	<span style="font-size:14px;"><strong><img align="right" alt="Pronab Sen, National Insurance Company Limited" height="184" src="http://www.newbusinessage.com/ckfinder/userfiles/Images/corporate_focus_feb2013_pronab.jpg" style="margin:0 0 0 10px;" width="150" /><br />
	</strong></span></p>
<p style="text-align: justify;">
	<span style="font-size:14px;"><strong>‘We strongly feel that competition is must to ensure prompt services to clients and it is good for the customers as they can look forward to better services.’</strong></span></p>
<p>
	<span _fck_bookmark="1" style="display: none;">&nbsp;</span></p>
<address>
	Dr Pronab Sen</address>
<address>
	CEO, Nepal Operations</address>
<address>
	National Insurance Company Ltd</address>
<p>
	<span _fck_bookmark="1" style="display: none;">&nbsp;</span></p>
<p style="text-align: justify;">
	<strong>Market Presence</strong></p>
<p style="text-align: justify;">
	Currently the NICL has six branch offices - three in Kathmandu and one each in Birganj, Biratnagar and Nepalganj. &nbsp;Sen said that the company has Beema &nbsp;Sewa &nbsp;Kendras &nbsp;in Hetauda and Janakpur. “Apart from this, we also have representatives based in Dhangadi, Dharan, Narayangarh, Simara and Birtamod with the controlling office in Kathmandu,” he explained.&nbsp;</p>
<p style="text-align: justify;">
	NICL has planned to expand its network to cities like Pokhara and Bhairahawa and upgrade the Beema Sewa Kendras to Sub Branch. Sen said that with a service oriented motive the NICL has some ambitious plans on a customer centric ground. Similarly the company is planning to organise insurance awareness programmes for the clients along with publicity and brand image.</p>
<p style="text-align: justify;">
	<strong>Products and Services</strong></p>
<p style="text-align: justify;">
	Being a non life insurance company, NICL offers wide range of products ranging from Motor, Fire, Personal Line policies like Sweet Home, Personal Accident, Health Insurance, Liability, and Aviation among others. According to Sen, the company has cattle and livestock and crop policy in its pipeline as the Insurance Board has already issued directives for the same.&nbsp;</p>
<p style="text-align: justify;">
	To ensure prompt services, the NLIC has centralised its claims processing and started a Centralized Claims Processing Hub in Kathmandu, with the sole idea of reducing the Turn Around Time (TAT) in claim processing, according to Sen. “On experimental basis, we have also started paying claims through Electronic Clearing Service (ECS) and in the initial stage, we are restricting it to the corporate clients and based on the results, we will initiate this system for all claims,” he revealed. Employee’s salary, surveyors payment and agency commission payment is being done through ECS as an experiment.</p>
<p style="text-align: justify;">
	<strong>Human Resources</strong></p>
<p style="text-align: justify;">
	The company has 76 employees as of now. &nbsp;The company believes that its employees are its most valuable assets. NICL gives value to the team work and the spirit of working in unity. Sen shared, “We are continuously trying to upgrade the soft skills of our team members with the motto “Grow Profitably” i.e. ensure top line as well as bottom line growth and feel proud to be an NICian.”</p>
<p style="text-align: justify;">
	He said that the company is continuously involved in developing the soft skills of its employees so that they can perform better and make the team more sensitive to customer’s needs and deliver results in time.&nbsp;</p>
<p style="text-align: justify;">
	Though having its parent company in India, NICL has just two expats from India and rest of its manpower is from Nepal itself. “Our recruitments are restricted to Nepali citizens only,” said Sen.</p>
<p style="text-align: justify;">
	However, one of the biggest challenges the company is facing at the moment is getting skilled manpower in insurance domain. To resolve this issue the NICL organises in-house training to its people.</p>
<p style="text-align: justify;">
	<strong><img align="left" alt="National Insurance Company Limited" height="314" src="http://www.newbusinessage.com/ckfinder/userfiles/Images/corporate_focus_feb2013_financial_highlights.jpg" style="margin:0 10px 0 0;" width="282" />Management Mantra</strong></p>
<p style="text-align: justify;">
	The NICL believes in maintaining the transparency and good corporate governance to its best. Sen explained, “Our management’s commitment is to maintain transparent working and remain committed to compliance of tariff and guidelines of the regulator and law of land.” The company has been able to maintain a cordial relationship with the regulator – Insurance Board of Nepal - in its operation history and strictly abide by all the rules and regulations issued by the regulator.&nbsp;</p>
<p style="text-align: justify;">
	Managing claims is probably one of the challenging jobs at an insurance company. To handle the sensitive issue, the company is concentrating on improving claims services and reducing TAT for claims settlement. Sen believes, being a part of the service sector, the overall business depends on the quality of the services offered. “Now we have a process in place, to depute surveyors immediately on receipt of the claim irrespective of the fact whether it is a holiday or a working day,” he said, “To complete the formalities to enable us to settle client’s claims at the earliest possible.”</p>
<p style="text-align: justify;">
	<strong>CSR Activities</strong></p>
<p style="text-align: justify;">
	Beginning from the 107th Foundation day on 6th December 2012, the NICL has initiated the CSR activities in Nepal. As a part of the CSR activities, the company distributed 107 blankets and rechargeable torches to poor elderly people and orphan children. NICL also organised a health check up camp and blood donation camp on 6th January 2013, which was attended by the NICL employees, clients and surveyors apart from general public. The company plans to plant 107 saplings shortly along with numerous other CSR plans in the pipeline.</p>
<p style="text-align: justify;">
	Similarly, the company is also the Gold Sponsor of Walkathon organised by Standard Chartered Bank every year for helping restoration of eyesight of visually impaired and to help the HIV infected persons in Nepal.</p>
<div>
	<img alt="National Insurance Company Limited" height="563" src="http://www.newbusinessage.com/ckfinder/userfiles/Images/corporate_focus_feb2013_swot.jpg" width="277" /></div>
<p>
	 </p>',
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			'description' => 'Though the competition has heightened much, insurance business has not been able to penetrate deep enough into the insurance market.',
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			'id' => '864',
			'article_category_id' => '38',
			'title' => 'Three “R”s For  Startup Businesses',
			'sub_title' => '',
			'summary' => null,
			'content' => '<p style="text-align: justify;">
	<span style="text-align: justify;">Businesses are hard to predict. There is a saying “God laughs at those who plan the future”. This applies both to life and to businesses, especially the ones that are just starting. Pukar Shah, a returnee from the UK, has recently started a business of planting Aloe Vera in his own ancestral land that was mostly going to waste due to shortage of trusted labourers. He believes that Nepal can improve its status only by making large investments in the agriculture sector. While the rest of the world has reached far away from the time of doing agriculture, 80 per cent of Nepal‘s population still relies on nature for a living. &nbsp;This is not only a culture but also a big natural advantage to Nepal. Nepal can grow everything that grows in between 8000 m to 60 m above sea level. While the richest country of the world, the US, with its organization USAID is investing in Nepal’s agriculture with projects like FTF (Feed the Future) and Health for Life (H4L), it is an opportunity to respond. Plus, according to Pukar, it is a risk-free business because he already has a line of buyers who want to buy his produce.&nbsp;</span></p>
<p style="text-align: justify;">
	Harvard Business School Professor Noam Wasserman has outlined &nbsp;three Rs for the people wanting to start up their own business. In his article, Wasserman lists them as “Three Pitfalls Startup Founders must avoid”. These are the relationship decisions, roles decisions, and rewards decisions. According to Prof Wasserman, while starting a new business, there’s a strong temptation to make decisions for the short term. But you need to anticipate the long-term challenges. It is very critical to get at least three things right. They are:&nbsp;</p>
<p style="text-align: justify;">
	<strong>Co-founders:</strong> The natural inclination is to co-find with family or friends. But these relationships can be fraught. Plus you’re more likely to have similar perspectives. Look for partners who bring complementary skills and assets.&nbsp;</p>
<p style="text-align: justify;">
	<strong>Roles:</strong> Most founders want a C-level title. After all, they were there from the start. But choose roles that reflect the actual work each founder will do, not the fancy title he wants to show off.&nbsp;</p>
<p style="text-align: justify;">
	<strong>Rewards: </strong>One of the biggest questions for start-ups is how to split the equity ownership. A handshake on 50/50 will not do because almost all new companies will have a major change in strategy or founder involvement. Negotiate an arrangement that can change when the circumstances do.</p>
<div style="padding:10px; background:#f4f3e6;">
	<p>
		<strong><span style="font-size:14px;">Naming the Company</span></strong></p>
	<p style="text-align: justify;">
		Together with the ideas, management and operation planning, NAME for the Startup Organization also makes a considerable difference. What’s in a name? Well judging from the long list of businesses that a simple Google search can yield when you search “naming your company”, there are plenty. While deciding on a name, don’t take the decision lightly. Not only is your company’s name a critical part of your overall identity, but it will also be used on any of your marketing products, PR, blogs, websites and publications. Given below are five naming strategies that have been successful globally.&nbsp;</p>
	<p>
		<strong>Real Words</strong></p>
	<p style="text-align: justify;">
		When you consider, Apple, Yahoo, Indeed and Amazon, they mean something but often they have no immediate relation to their business.&nbsp;</p>
	<p style="text-align: justify;">
		<strong>Misspelled Words</strong></p>
	<p style="text-align: justify;">
		No, this isn’t an insult of your intelligence. We know that you know how to spell, but using phonetics rather than grammar may give you that cool edge you need. Consider some of these well known examples; Tumblr (Tumbler), Del.icio.us (Delicious), Digg (Dig) and Flickr (Flicker).&nbsp;</p>
	<p style="text-align: justify;">
		<strong>Two Syllable, Compound Words</strong></p>
	<p style="text-align: justify;">
		There are plenty of new companies moving in this direction. Among some of the most popular, there’s BirchBox, SkillShare, CrowdTilt and JackThreads. This could possibly have something to do with the success of FaceBook.&nbsp;</p>
	<p style="text-align: justify;">
		<strong>Initials and Acronyms</strong></p>
	<p style="text-align: justify;">
		Think about going old school, such as IBM (International Business Machines), AOL (America Online) and TBS (Turner Broadcast System). You’re not alone. Reportedly, Rupert Murdoch is considering changing the name of The Wall Street Journal to simply “WSJ”.&nbsp;</p>
	<p style="text-align: justify;">
		<strong>Made-Up Words</strong></p>
	<p style="text-align: justify;">
		Skype, Hulu and Zynga are all made up words. But if you’re successful, you most likely won’t find yourself in any trademark grudge matches in the future.&nbsp;</p>
	<p style="text-align: right;">
		<span style="font-size:11px;">(Source: compiled from various sources)</span></p>
</div>
<p>
	 </p>
<p style="text-align: justify;">
	Pukar, in his startup business, has successfully implemented all these strategies. He happens to follow this idea from his uncle who has been involved in this sector for over 20 years now. Pukar is confident that his uncle’s expertise and his knowledge in proper management of the company will help him succeed in the long run in this sector. Pukar is not obsessed with the CEO title. He has chosen the role of managing the production process and looking after the financials while his uncle handles the marketing department. He had set up an initial agreement of 50 per cent &nbsp;investment and 50 per cent &nbsp;returns with his uncle. But according to him, he currently owns only 35 per cent of the return and the overall organization has four shareholders from two in just a matter of a year. He believes that one cannot have a fixed agreement in business; instead, one needs to go with the flow.</p>
<p style="text-align: justify;">
	Also, it is very crucial to understand the cash flow before starting a business. More than a third of new businesses fail in the first three years and it’s rarely because of a bad business concept; it’s almost always the result of running out of cash. As well as having working capital to cover early stage losses, it’s imperative that you collect your invoices on the due date. If you don’t, you are providing working capital to your customers and unless you are running a bank, you can’t afford to do this. According to Pukar, if cash is the king for a successful business, it’s the emperor for a start-up. &nbsp;</p>
<p style="text-align: justify;">
	<img align="left" alt="Management February 2013" height="259" src="http://www.newbusinessage.com/ckfinder/userfiles/Images/management_feb2013(4).jpg" style="margin:0 10px 0 0;" width="250" />For Pukar, there was no problem of having insufficient resources and capital for giving a shape to his idea, but most of us who want to start a business do not have the resources and capital. Not only in Nepal but also in most of the developed countries in the world, there are angel investors. Angels typically invest their own funds, unlike venture capitalists, who manage the pooled money of others in a professionally-managed fund. Angel investments bear extremely high risk and are usually subject to dilution from future investment rounds. As such, they require a very high return on investment. A large percentage of angel investments are lost completely when early stage companies fail. Therefore,, professional angel investors seek investments that have the potential to return at least 10 or more times their original investment within five years through a defined exit strategy such as plans for an initial public offering or an acquisition. The Silicon Valley of the United States of America, also known as the home to many of the world’s largest technology corporations as well as thousands of small startups, was funded by the Angel investors from the beginning. A Harvard report by William R Kerr, Josh Lerner and Antoinette Scholar provides evidence that angel-funded startup companies have historically been less likely to fail than companies that rely on other forms of initial financing.</p>',
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			'id' => '863',
			'article_category_id' => '38',
			'title' => 'Is Shakespeare Relevant In Today’s Commercial World?',
			'sub_title' => '',
			'summary' => null,
			'content' => '<p>
	<strong style="text-align: justify;">By Sujit Mundul</strong></p>
<p style="text-align: justify;">
	There have been lots of debates and discussions on the relevance of Shakespeare’s heroes as leaders in the modern commercial world. On this widely debated subject, a great deal of work had happened in the Oxford University under the leadership of Richard Oliver.</p>
<p style="text-align: justify;">
	I have had the good fortune to interact with Richard many times on the issues of leadership, seeking his guidance. It is increasingly common to hear nowadays that we are facing a crisis of leadership. The ways in which organizations are moving forward can no longer be comprehended through the same models, language and logical analysis that have served leaders in the past.</p>
<p style="text-align: justify;">
	I could strongly agree with Richard that the time has come when businesses actually need what the arts have to offer in order to survive. We can draw a good deal of similarity between the commercial world and the arts, in that both the streams, apparently poles apart, need creativity, imagination, flexibility, adaptability, effective communication and visionary tendencies for survival as well as &nbsp;domination in the respective fields.</p>
<p style="text-align: justify;">
	Stories have been used to inspire and instruct us human beings since we learnt to speak.</p>
<p style="text-align: justify;">
	Let us take a look at Shakespeare’s stories. Henry V is the story from which we can glean the most about the nature of inspiration. From the first line that calls to our imagination with its plea for “a muse of fire”, to the last scene where Henry, as a Victorian leader, struggles to turn a battlefield into a garden, the plot, to my reckoning, reflects invaluable insights into leadership.</p>
<p style="text-align: justify;">
	Henry V unites a group of disparate people (his nobles) around a common goal (in this instance, reclaiming the territory of France) and manages to overcome all difficulties in his path to achieve a near miraculous victory against the odds (i.e. winning the Battle of Agincourt).</p>
<p style="text-align: justify;">
	So, readers are encouraged to see the King as an inspired leader, the nation as an organization, the nobles as the senior management team, and France as a big project. &nbsp;I am sure that once we start thinking along these lines, we can very well find the relevance of Shakespeare’s characters in today’s changing world. Shakespeare survives gracefully through the changing fads of every generation because he touches so consistently on the truth of human experience.</p>
<p style="text-align: justify;">
	Henry V takes over as King after the sudden demise of his father, the late King.But people can’t believe that Henry, who has the reputation of a spoiled brat, would allow Lord Chief Justice (a hard critic of Henry) to continue in the same position as also to become his mentor. In addition Henry promises to call Parliament. His journey begins.</p>
<p style="text-align: justify;">
	In Act 1 we see Henry meets with his nobles to gather support for achieving his mission to reclaim the territory of France. He gets their consent. Henry has sent a message to the King of France asking if he will give up his throne. The French ambassador arrives with an answer; a trunk which Henry assumes will be full of jewels in an attempt to buy him off. Instead, it is full of tennis balls sent by the French Prince with an accompanying message that Henry better stick to the trivial pursuits he is capable of winning like tennis. Henry gives the ambassador a right –royal telling off and sends him out. Finally, he makes a firm commitment to pursue his mission to France.</p>
<div>
	<img alt="Management February 2013" height="234" src="http://www.newbusinessage.com/ckfinder/userfiles/Images/management_feb2013(2).jpg" width="580" /></div>
<div>
	<div style="text-align: justify;">
		In commercial life, when we start our first project as a leader, we need to seek sound advice and believe in the “right” to go ahead. This “right” is granted internally and externally. Internally we can use a “line of service” to draw strength from. But we need certain amount of political intelligence to win the external right, to prepare our nobles (senior management) to take a risk and follow us into new territories. And we will have to make a demonstrable and visible commitment to pursue the project. If people think we are not totally behind this, the project may fail. Henry did follow all these steps.</div>
	<div style="text-align: justify;">
		 </div>
	<div style="text-align: justify;">
		In Act 2 Henry gathers and allocates his available resources and identifies and deals with those who oppose the mission (and the traitors) before it has even started.</div>
	<div style="text-align: justify;">
		 </div>
	<div style="text-align: justify;">
		In all major projects, leaders should be able to identify the forces ranged for and against them. Many a times, a good leader has to be a good actor. He may need to hide certain knowledge from certain people at certain times. He may need to disguise intentions, particularly while attempting to identify those who disagreed with the agreed mission and who may oppose its desired outcome. It is important to identify them correctly and deal with them appropriately for ensuring success of the project.</div>
	<div style="text-align: justify;">
		 </div>
	<div style="text-align: justify;">
		In Act 3, Henry starts with a reasonable plan: arrive in August with 10,000 troops, take the first foothold in a week and march on to Paris by Christmas. He lands at the coastal town of Harfleur as planned but three months later, he is still there having lost 2000 men. He makes a rousing speech to his exhausted troops. An effective leader will have to speak passionately and imaginatively to motivate them through the blocks. The next attack seems to make a difference, for the Governor of Harfleur asks for a peace party. Henry speaks and warns that if the town is not surrendered now; he will be unable to control his troop’s anger. Then when they do succeed, the town will be destroyed and people killed. The Governor surrenders the town. Henry insists that all the inhabitants be treated mercifully. He changes strategy and decides to withdraw to Calais (an English territory at that time) where his troops can rest over winter.&nbsp;</div>
	<div style="text-align: justify;">
		 </div>
	<div style="text-align: justify;">
		Throughout the play, Henry demonstrates the wonderful leadership quality of painting pictures of the future. Here he uses it to paint such a negative view of the future that the Governor gives in rather than risk that picture becoming reality. He does not press on to his initial goal regardless; he revises his strategy on the ground. Nor does he admit failure and simply retreat to England. He finds a third way; a strategic withdrawal.</div>
	<div style="text-align: justify;">
		 </div>
	<div style="text-align: justify;">
		The French army is chasing Henry’s exhausted 8000 walking men with 40,000 fresh mounted troops. Inevitably they catch up and surround the English on the field of Agincourt. The French Herald is sent in to offer Henry a simple choice; give in now (and pay a huge fine but Henry and all his troops leave), or fight tomorrow and die. Henry says he does not seek a battle at the moment; he wishes to march to Calais, but if challenged he will fight. The French prepare for battle.</div>
	<div style="text-align: justify;">
		<strong><span style="font-size:16px;"><br />
		</span></strong></div>
	<div style="text-align: justify;">
		<strong><span style="font-size:16px;">Managers have to solve problems. Leaders have to solve dilemmas, complex issues with no happy solutions. When leaders meet the real test, they will require to call on all their skills to hold a line that will give their people enough confidence to carry on</span></strong>. Act 4 shows Henry going through the long dark night before the battle, facing up to his fears and duties before being able to inspire his troops to an apparently miraculous victory against the odds.</div>
	<div style="text-align: justify;">
		 </div>
	<div style="text-align: justify;">
		Henry cannot really want to be out talking to his troops at 3 o’clock in the night. But he does it because it is required of him. He exercises visible leadership which is seen by others thus bolstering their confidence.</div>
	<div style="text-align: justify;">
		 </div>
	<div style="text-align: justify;">
		Leaders need to allow themselves to enter “the dark night of the soul” and face their own innermost fears, doubts and uncertainties, especially in a crisis, and particularly before they make decisions that affect the lives of others. If they don’t, they may make wrong decisions for the wrong reasons. There is a point in most meaningful projects when the leaders are forced to ask themselves: “Is this the right thing to do? And are we the right persons to do it?” In these times they will have to manage their own fears and the fears of others simultaneously but differently.</div>
	<div style="text-align: justify;">
		 </div>
	<div style="text-align: justify;">
		Henry is courageous enough to listen to what the troops really think. But if he listens carefully to what they are thinking, he may just be able to inspire them later. However, he also feels the weight of responsibility that they put on him. He needs to unload this or he may make his decision on what others want rather than what he thinks is right. When Henry arrives back at his tent, he overhears the nobles wishing for more troops. He speaks to them from the heart, telling them why he personally believes they are doing the right thing. He says they are enough to win honorably or die trying. He says those that do not wish to fight can leave. But any that chose to fight and survive will remember this day for the rest of their lives. They go off to start the battle.</div>
	<div style="text-align: justify;">
		 </div>
	<div style="text-align: justify;">
		The whole process of surviving the “Dark Night” has served to strip away layers to reveal Henry’s center, his core values - what he is doing all this for. Mind you, it is from this core that he speaks to inspire others.</div>
	<div style="text-align: justify;">
		The battle is going well for the English. They deal with the first wave of French attack and capture many prisoners. Another attack is sounded. Henry orders his men to kill the prisoners. Meanwhile the French have raided the luggage tents and killed all the boys who were guarding them. The Herald enters and tells Henry the day is his. He thanks God and forbids everyone to boast of the victory. They set off for Calais.</div>
	<div style="text-align: justify;">
		 </div>
	<div style="text-align: justify;">
		Most leaders wish they could get through their career without having to take any tough decision. Very few get their wish. There is usually a situation where we are forced to compromise the values on which we prided ourselves when we started our journey to leadership. It is the ability to take these hard decisions and live with the consequences that separates “the men from the boys” amongst the leaders.</div>
	<div style="text-align: justify;">
		 </div>
	<div style="text-align: justify;">
		In Act 5 Henry is encouraged to make peace and turn the battlefield into a garden. He attempts to court Princess Katherine (daughter of the French King) but realizes he has much to learn about building relationships before the political necessity becomes a heartfelt reality.</div>
	<div style="text-align: justify;">
		 </div>
	<div style="text-align: justify;">
		Katherine agrees to the marriage but Henry can tell she does not yet love him. He understands that he has to change his approach and learn a new way of life.</div>
	<div style="text-align: justify;">
		 </div>
	<div style="text-align: justify;">
		Many leaders have got where they are because of their ability to fight and win. Sometimes though, this is not enough. &nbsp;We may have to nurture the new territory we have achieved rather than look for the next target.</div>
	<div style="text-align: justify;">
		 </div>
	<div style="text-align: justify;">
		To my mind, Shakespeare’s relevance in the modern complex world of commerce holds good adequately. Nevertheless, I leave it to the readers to decide on this enunciation, as they feel apposite.</div>
	<div>
		 </div>
	<div>
		<strong>Mundul is a Director with Standard Chartered Bank Nepal Ltd.</strong></div>
</div>',
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			'description' => 'Shakespeare survives gracefully through the changing fads 
of every generation because he touches so consistently on 
the truth of human experience.',
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			'title' => 'Global Economy Outlook  For 2013: Figures & Beyond!',
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			'content' => '<p style="text-align: justify;">
	<strong>By Sandip Nepal</strong></p>
<p style="text-align: justify;">
	The year 2012 remained gloomy for the entire seven billion plus world population in terms of economic growth and prosperity. With world economic leaders like the USA, Eurozone and China not acquiring the ‘expected status’ for the year, i.e. 2012, amidst spiking issues like unemployment, inflation and debt crisis regimes, prospects for 2013 do not look encouraging at this point of time.</p>
<p style="text-align: justify;">
	Concerned over the ongoing austerity measures, high unemployment rate and lower business confidence combined with weak market sentiments in core global economies like the USA and Eurozone, the World Bank (WB) has lowered its forecast for 2013. Market analysts and global institutions, pioneering in economic forecasts, are coming up with new lowered growth forecasts for the current year in line with lower than expected manufacturing and trade indicators coming from both sides of the Atlantic. The world economy was initially expected to grow by 3 percent in 2013. However, the new growth forecast based on the current and prospect scenario has come out to be 2.4 per cent, lowered by 60 basis points from the initial forecast.&nbsp;</p>
<p style="text-align: justify;">
	Similarly, amidst reduced global growth, market analysts and economists from around the world have lowered their growth forecast for the ‘land of the rising sun,’ i.e., Japan, US and the more vigilant economy, the Eurozone. It is believed that the second year of contraction in the Eurozone will have a tremendous impact on the global economy and could act as a reverse-catalyst in the global economic atmosphere, measured by Global Purchasing Managers’ Index or any other global index. Having inter-twined relationship with economic superpowers &nbsp;such as China, Eurozone and the US, emerging economies like India, Brazil, Mexico and other East-Asian economies fear that they cannot remain unaffected by the contraction in the economic environment of the world’s economic hubs. However, developing economies from around the globe are expected to expand at the rate of above 5.5 per cent in 2013.</p>
<p style="text-align: justify;">
	The World Bank has already warned against the fragility and vulnerability of the global economy in the remaining months of 2013. On the other hand, the report has also emphasized that the magnitude of economic downside will be at decreasing rate compared to recent precursor years. If we turn back and scrutinize 2012, European measures, reforms and policies to cushion the financial/debt crisis in the single economic bloc have not been able to provide economic surge or even correction to the ongoing recession. At a time when financial and political agendas have not been facilitating economic improvement in the single currency bloc, issues related to spending cuts and tax hikes in the US, diplomatic tensions between Japan and China affecting trade environment, and ‘not so good’ manufacturing and industrial indicators coming from the US and China are feared to cloud whatever little optimism remains for &nbsp;the ongoing year.</p>
<p style="text-align: justify;">
	<strong>Global Economic Growth Forecast for 2013</strong></p>
<p>
	<strong><img align="left" alt="Economy and policy February 2013" height="230" src="http://www.newbusinessage.com/ckfinder/userfiles/Images/economy_policy_feb2013.jpg" style="margin: 0 10px 0 0; " width="250" /></strong></p>
<p style="text-align: justify;">
	Considering the gloom in the world economic regimes in 2012 and the grayish ongoing global economic performance, the US in 2013 is forecasted to grow by 1.9 per cent. With political tensions mounting between two core Asian economies, Japan and China, amid affected Japanese trade in automobiles and related industries, and with contraction in one of the largest export sectors, the Japanese economy is expected to witness a meager growth of only 0.7 per cent in 2013. Unlike the economies mentioned above, the Chinese economy with its improving manufacturing sector, satisfactory flow of Foreign Direct Investment and export data has been projected to grow by an attractive 8.4 per cent in 2013, though the figure is 20 basis points lower than the previous projection for the year. Further, increasing Chinese appetite for FDI outflow also exhibits the magnitude of its economy. Moving on to emerging economies, the growth rates for India, Brazil and Mexico have been projected to be 6.1, 3.4 and 3.3 percent, respectively. With economies like the Eurozone and the USA not really supporting these emerging economies, these expected growth rates could be deemed satisfactory.</p>
<p style="text-align: justify;">
	<strong>Nepali Economy in 2013 and Global Influence</strong></p>
<p style="text-align: justify;">
	Nepali exports have seen a decline in recent months, thanks to the economic slowdown in the Euro Area and a mild US economy. Nepali industries like, garment, herbs, handicraft, carpet, metal-wood and other related sectors are hit hard by the global meltdown. Combined with the international pessimism, ‘below-par’ agricultural and industrial performance is also contributing to drag the economy towards austerity. In line with the current and forecasted economic indicators, the WB has forecasted Nepal’s economic growth rate to be 3.8 per cent for fiscal year 2012-13, which is 80 basis points lower than the actual economic growth rate for fiscal year 2011-12.</p>
<p style="text-align: justify;">
	The key issues contributing to lowered growth forecast could be attributed to the ongoing constitutional crisis, poor investment environment (in terms of FDirectI) and infrastructural bottlenecks in the country. Besides the ongoing political instability and poor market sentiments, inadequate and inefficient public expenditure, too, has been hampering the economic outlook, which, in turn, may further contribute to downgrading the current forecasted growth rate. Remittance, working as a key source of financing, incorporates around 22 per cent of the national Gross Domestic Product (GDP). At this point of economic junction, as remittance has been facilitating to finance imports, covering trade deficits with counterparts, the year ahead could also see an optimistic inflow of funds, taking into account the numbers of Nepalis working abroad, especially in the Gulf countries.</p>
<p style="text-align: justify;">
	With the WB having already lowering Nepal’s growth forecast for fiscal year 2012-13 and remittance acting as an economic catalyst, it’s political leaders and government authorities who could possibly look into the matter and plug the loopholes in the operating environment, eventually facilitating, promoting and simplifying investment grounds for national and international market participants. Only time would tell what the government would do to address the situation and improve the country’s GDP growth rate, lower dependency on remittance and international debts for the year and henceforth.</p>
<p style="text-align: justify;">
	<strong>The author is Assistant Manager, Research &amp; Development Department, Mercantile Exchange Nepal Limited, Nepal.</strong></p>',
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			'description' => 'Concerned over the ongoing austerity measures, high unemployment rate and lower business confidence combined with weak market sentiments in core global economies like the USA and Eurozone, the World Bank (WB) has lowered its forecast for 2013.',
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			'article_category_id' => '31',
			'title' => 'Visiting Business People: February 2013',
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			'content' => '<p>
	<strong><span style="font-size:16px;">‘We help people make good change take root’</span></strong></p>
<p>
	<img align="right" alt="Bill Stockton" height="286" src="http://www.newbusinessage.com/ckfinder/userfiles/Images/bill_stockton_visiting_business_people(1).jpg" style="margin:5px 0 10px 10px;" width="250" /><strong> </strong></p>
<p style="text-align: justify;">
	<span style="color:#f00;">Bill Stockton</span> is a Senior Advisor of the Verghis Group, a management consulting firm.<span style="text-align: justify;">He is known as the ‘center of gravity’ for knowledge sharing practice and consulting within the financial sector including investment and retail banking and insurance companies in the Verghis Group. Stockton graduated in Psychology from the University of North Carolina at Chapel Hill. He served Deutsche Bank for 18 years, mainly in the IT department. &nbsp;He was the director and global head of support and operations for over 20 products including foreign exchange, equities, programme trading, cash management and more. Most recently, he was tapped by Deutsche Bank to institute a global knowledge sharing programme that trained over 3200 IT staff and demonstrated productivity gains. In an interview with Nubiz recently when he was in Kathmandu, Stockton shared the importance and need of knowledge sharing and knowledge management in any organization.&nbsp;</span></p>
<p>
	<strong><strong>Excerpts:&nbsp;</strong></strong></p>
<p style="text-align: justify;">
	<strong><strong>What are your recent engagements?</strong></strong></p>
<p style="text-align: justify;">
	I left Deutsche Bank as a Director and as an IT Manager. I left because I think I can do much more, particularly in the area of knowledge sharing in finance companies. We have three small companies in the Verghis Group. We can resolve things primarily on knowledge sharing and knowledge management. Also, we do a quite a lot of work on measures, metrics and madness which is about stopping measuring activities and reassuring for outcome. We do also have a research wing which conducts very exciting research, mostly on behaviour psychology- the kind of research we primarily conduct.&nbsp;</p>
<p style="text-align: justify;">
	<strong><strong>What brings you to Nepal?</strong></strong></p>
<p style="text-align: justify;">
	My ancestors had been coming to Nepal for a long time. We did not come here for business. We came here because we are interested in all the things we have heard about Nepal.&nbsp;</p>
<p style="text-align: justify;">
	<But my partner, Christina, has come here several times a year for the past ten years. &nbsp;Her visits are mainly aimed at supporting organizations like Sano Paila in Birgunj and other women’s groups for social service. Professionally, she is a doctor in psychology and has done quite a lot of work in areas like peace negotiation and conflict management. She is also from the leadership training which is mostly about working with people who don’t usually talk together productively. So, I joined her on a number of those session conducted here.&nbsp;</p>
<p style="text-align: justify;">
	>There are some really exciting possibilities in my mind about knowledge sharing. Many people don’t know what knowledge sharing or knowledge management is. A number of companies need knowledge management. Research show whether it be Deutsche Bank, Mega Bank or Coca-Cola - around 60-90 percent problem is solved by somebody else in the organization. So, knowledge management is about the behaviour and practices required to make that knowledge available to anyone who needs it in the organization.&nbsp;</p>
<p style="text-align: justify;">
	What I see is, when you get a really good idea you don’t want anyone else to know that idea. You try it just by yourself. But in today’s new Internet age, if you put your ideas right there, other people can come and collaborate. The more I share what I know, the more valuable I become. People have trouble doing that and they have also trouble believing that.&nbsp;</p>
<p style="text-align: justify;">
	<strong><strong>How does your strategy help other organizations?&nbsp;</strong></strong></p>
<p style="text-align: justify;">
	We teach companies how to capture the intellectual capital of the employees in all sorts of makeshift and inefficient repositories so that once a problem is solved, future occurrences of the same or similar problems will be prevented or resolved much faster.&nbsp;</p>
<p style="text-align: justify;">
	<strong><strong>What prospects do you see for your business in Nepal? &nbsp;</strong></strong></p>
<p style="text-align: justify;">
	These are universal problems faced by companies from Wall Street in New York to Kantipath in Kathmandu. We tailor our work to each customer not only to offer services at a good price but also to determine whether or not we think we can add value to our clients.</p>
<p style="text-align: justify;">
	<strong><strong>&nbsp;What are your plans?&nbsp;</strong></strong></p>
<p style="text-align: justify;">
	We have several research projects underway. These projects are about ensuring better client satisfaction during a tech support or services support call. We are also putting together an online site to help make organizational change stick. Change is so difficult to anchor and become “sticky”. We help people make good change take root while helping organizations and businesses prioritize and differentiate between doing the right things and doing things right.</p>',
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	Etihad Airways, the national airline of the United Arab Emirates, has commenced its new schedule of daily flights between Abu Dhabi and Brisbane via Singapore this week (give the exact date). To mark the occasion, Etihad Airways operated ‘Blue Moon Rising’, its Airbus A330-200 painted in Manchester City Football Club colours on the commemorative February 1 flight. James Hogan, President and Chief Executive Officer of Etihad Airways, said that the new daily service would add an extra 1,048 seats a week to the Abu Dhabi-Singapore-Brisbane route. “The additional capacity puts Etihad Airways in a stronger than ever position in the Singapore and Australian markets. It enables us to compete on a more level playing field than in the past,” said Hogan. He also said that the airline was working closely with government and industry stakeholders in each market to ensure the route’s continuing success.&nbsp;</p>
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	Etihad Airways commenced three weekly flights to Brisbane and Singapore on September 28, 2007. The Queensland capital was the airline’s second destination in Australia and the 43rd in its global network. The airline operates its state-of the-art Airbus A330-200 aircraft on the Abu Dhabi- Singapore-Brisbane route. The aircraft is configured in two classes with 22 seats in Pearl Business Class and 240 seats in Coral Economy Class.&nbsp;</p>
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	Oman Air is offering a Special Companion scheme for Business class for a period of 20 days from February 1 to 20.The airlines has informed that the travel can be completed by 31 May 2013. According to the airline, the customers can avail this offer by contacting their travel agents.</p>',
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FOREX

Currency	Unit	Buy	Sell
U.S. Dollar	1	121.23	121.83
European Euro	1	131.65	132.31
UK Pound Sterling	1	142.47	143.18
Swiss Franc	1	124.29	124.90
Australian Dollar	1	71.69	72.05
Canadian Dollar	1	83.90	84.32
Japanese Yen	10	10.94	11.00
Chinese Yuan	1	17.17	17.26
Saudi Arabian Riyal	1	32.27	32.43
UAE Dirham	1	33.01	33.17
Malaysian Ringgit	1	27.36	27.50
South Korean Won	100	9.77	9.82

Update: 2020-03-25 | Source: Nepal Rastra Bank (NRB)

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Fine Gold	1 tola	77000.00
Tejabi Gold	1 tola	76700.00
Silver	1 tola	720.00

Update : 2020-03-25

Source: Federation of Nepal Gold and Silver Dealers' Association

Petroleum

Petrol	1 Liter	106.00
Diesel	1 Liter	95.00
Kerosene	1 Liter	95.00
LP Gas	1 Cylinder	1375.00