Kathmandu. The issue rating of Nepal Reinsurance Company Limited has been downgraded. Credit rating firm ICRA Nepal has downgraded the rating of the company from ‘ICRA NP IRA’ to ‘ICRA NP IRA A’. The rating of the company has been maintained under ‘negative impact monitoring’.

According to the rating released by ICRA Nepal on September 3, 2026, the main reason for downgrading the rating of Nepal Reinsurance Company is the devastating flash floods that occurred on August 26. According to the company, the rating has been downgraded due to the potential major impact of the floods on the company’s financial condition.

The floods caused huge human casualties and damaged various hydropower projects with a capacity of about 700 MW in the river basin, ICRA Nepal said. In addition, various other insurable properties, including private and commercial vehicles awaiting customs clearance, were also badly damaged.

ICRA Nepal estimates that due to the floods, the overall insurance claim amount will increase and the share of Nepal Reinsurance Company in it may also increase. In such a situation, there is a risk that the reinsurance cover provided by the company may not be sufficient to manage the damage caused by the disaster. ICRA Nepal has said that this may put additional pressure on the net assets of the company, which is already weak.

The company’s net worth had already weakened due to insurance claims related to the riots in September 2025. If there is an additional claim from the floods, the financial condition and liquidity of the company may be further affected.

According to the information of the Insurance Authority, a total of Rs 25.87 billion worth of flood-related insurance claims have been received till August 29. However, the actual impact of the financial and liquidity position of the Nepal Reinsurance Company will be determined by the amount of claim that is finalized, ICRA Nepal said. Therefore, the final claim amount has been made an important subject of monitoring for the company’s rating.