The Vocabulary You Should Know about Life Insurance in Nepal
The Vocabulary You Should Know
The Vocabulary You Should Know
| Term | What It Means |
| Sum Assured | The coverage amount — what the family receives on death or the policyholder at maturity |
| Premium | The annual/monthly payment to keep the policy active |
| Bonus | Extra amount declared annually by the company on with-profit plans — guaranteed once vested |
| Claim Settlement Ratio (CSR) | % of death claims paid — the single most important company metric |
| Surrender Value | What you get back if you cancel early — only builds after 3 years of premiums |
| Rider | An add-on benefit — accident, critical illness, or disability coverage bolted onto the base policy |
| Endowment | Savings + protection combined — pays out at maturity or death |
| Pure Term | Protection only — nothing paid at maturity if alive |
| ULIP | Market-linked — part premium goes into funds, returns depend on market performance |
| Money Back | Returns part of sum assured at regular intervals during the term |
| NIA / Beema Pradhikaran | Nepal Insurance Authority — the regulator, formerly Beema Samiti |
| RBC | Risk-Based Capital — the solvency framework NIA uses to ensure companies are financially stable |
| Actuary | The specialist who calculates premium rates and reserves for insurance companies |
| Lapse | What happens when you miss a premium payment beyond the grace period — policy goes inactive |
| Revival | Reinstating a lapsed policy — companies allow this within a certain period |