RICBL Ready for GMC and to Take On Any Challenger

RICBL Ready for GMC and to Take On Any Challenger

As the development of Gelephu Mindfulness City (GMC) gains momentum, there is a growing need for insurance companies to address the global protection gap for consumers and finance risk reduction initiatives. Responding to this noble vision, the Royal Insurance Corporation of Bhutan Limited (RICBL) is preparing an insurance scheme specifically tailored for GMC. Further, the corporation is ready to face any competitor in the financial market. RICBL’s Chief Executive Officer (CEO), Karma, shared this during the corporation’s golden jubilee celebrations on January 8, 2025.

The proposed City Insurance aims to act as a steward of risk management through effective policy-making and urban planning. It also seeks to foster awareness and understanding of risk and insurance within the urban environment. The scheme will offer customized insurance solutions designed for property owners and landlords in GMC.

CEO Karma added that RICBL is fully prepared to introduce an insurance policy for GMC. In an exclusive interview with Business Bhutan, the CEO emphasized, “Providing reinsurance for GMC will be RICBL’s primary focus.”

To achieve this, RICBL plans to arrange reinsurance agreements and negotiate premiums with global companies. Highlighting its robust international network, the CEO assured that only top-rated companies would be considered for reinsurance in GMC. “We will not engage companies with ratings below ‘A,’” he added. “RICBL will be ready to provide all types of insurance and credit facilities to the investors in GMC,” he said.

Although credit ratings do not offer direct insights into an insurance company’s securities performance, they serve as critical indicators of the firm’s financial stability and capacity to meet policyholder claims. These ratings, issued by independent agencies, represent informed opinions rather than absolute facts. Variations in rating scales among agencies often lead to differing evaluations of the same company, reflecting the nuanced nature of credit rating systems in the insurance industry.

RICBL’s readiness is further supported by its existing infrastructure in Gelephu, which includes three operational buildings. The institution can launch its GMC insurance operations at any time, either by appointing a dedicated project manager or through virtual operations from its headquarters. RICBL’s existing human resources can be immediately deployed without requiring additional personnel in Gelephu.

Additionally, the CEO said that RICBL’s North Star is to become the “Crown jewel of the financial sector of Bhutan”. According to him, the objective will be based on measurable parameters like return on equity (ROE). “The main reason for people to invest in shares is to either receive reasonable dividends or appreciation in the price of their shares. RICBL hopes to be able to make good profit to either pay high dividends or see appreciation in the price of their shares. This is called return on equity. We are confident because we have put in place strong operational risk management and a professional cadre of employees. We also hope that 13th Plan will boost the economic growth because there is a strong correlation between the economic growth and insurance growth,” he added.

Speaking about inclusion, the CEO said RICBL has not been able to provide microinsurance and crop and livestock insurance. “These are so essential to the rural population of the country. But these insurance products will be affordable only if the government shares the risk by paying a part of the premium.” He added that elsewhere the government pays as high as 80 percent of the premiums on selected crops and livestock depending on their importance to the livelihood of the farmers. “Premiums in Bhutan for crop and livestock are already low but are still high for the farmers. Government already subsidizes the rural life insurance program of Nu.30,000 per person. Crop and livestock fall in the same category of importance if the farmers of Bhutan are to be protected from wildlife, pests, drought, flood, inundation, wild fires, animal epidemics etc,” he said.

On three outstanding achievements of RICBL in the past 50 years, CEO Karma RICBL has provided protection, resilience, and financial wellbeing to the people, taxes to the government and high dividends and share price appreciation to the shareholders.

Since its establishment on January 1, 1975, RICBL has consistently supported Bhutan’s growth and security by providing comprehensive insurance solutions. As the insurance industry evolves, RICBL remains committed to delivering innovative, customer-centric services while safeguarding the lives and properties of all Bhutanese citizens.

Sangay Rabten from Thimphu