Kathmandu, November 16 – Nepal’s insurance regulator has issued new rules that require all insurers to stop dealing with anyone linked to terrorist groups worldwide. The move is part of the country’s effort to get off the Financial Action Task Force (FATF) grey list, where nations are flagged for weak anti‑money‑laundering and counter‑terror financing measures.
Why the new rules matter
- FATF placement – Nepal was added to the FATF grey list in February. The list includes countries that need urgent help cleaning up their financial systems to stop terrorism and illicit trade.
- Targeted financial sanctions (TFS) – A major reason the regulator highlighted was Nepal’s lack of strong rules to block people and organisations that help fund terrorism.
- UN‑designated groups – The new guidance lists UN Security Council terrorist entities such as Lashkar‑e‑Toiba (LeT), Jaish‑e‑Mohammed (JeM), and Harakat‑ul‑Jihad Islami (HuJI). All of these groups have been linked to attacks in India.
What insurers must do
- Freeze assets – Stop any transfer, settlement, or conversion of money or property owned by a person or company on the UN list.
- Stop insurance services – Revoke policies, refuse new coverage, and prevent claim payments to designated people.
- Keep systems current – Update databases daily using automated tools that check names against the latest UN sanctions list and Nepal’s own TFS portal.
- Get alerts – Subscribe to the UN’s email list (sc‑sanctionslists@un.org) and the Ministry of Home Affairs TFS portal to receive instant updates on new sanctions or delistings.
If an insurer finds a match, the assets of that individual or organisation must be frozen immediately. The regulator warns that failure to follow these steps could cost the company a warning, a fine of 1 million to 50 million Nepalese rupees, or even the revocation of its licence.
Bigger picture
The central bank, Nepal Rastra Bank, and the Securities Board of Nepal already issued similar “Guidelines on Targeted Financial Sanctions.” They urge all banks, insurance firms, and other financial institutions to keep records of UN‑sanctioned entities and to halt any business with them.
By tightening its rules, Nepal is showing the global community it is serious about preventing money from fueling terrorism. Success could lead to the country’s removal from the FATF grey list, improving trade, investment, and financial confidence both at home and abroad.
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