Section 43: Restriction on Distribution of Dividend

1) Notwithstanding anything contained in the prevailing laws, no insurer shall be allowed to declare and distribute dividends to shareholders unless:

(a) All its preliminary expenses are recovered and all losses sustained until the previous year are recovered and all the funds prescribed by this act and the Nepal Insurance Authority are provisioned,

(b) Paid-up Capital pursuant to section 36 is maintained,

(c) Solvency Margin Ratio pursuant to section 42 is maintained,

(d) Shares allotted to the general public are completely sold and paid up.

2) Every insurer must obtain the approval of the Nepal Insurance Authority before declaring and distributing dividends, as per prevailing law.