Amidst deep concerns over low insurance penetration in Pakistan, regulators are pushing for comprehensive reforms, including a new insurance law and proposals for mandatory catastrophe coverage for public assets to strengthen financial protection against natural disasters. These measures were discussed at a high-level meeting between the Securities and Exchange Commission of Pakistan (SECP) and a visiting delegation from the Asian Development Bank (ADB).
The ADB delegation, led by Country Director Emma Fan, met today with SECP Chairman Dr. Kabir Ahmed Sidhu and his insurance team at the commission’s headquarters to review ongoing reforms and identify areas for future collaboration.
The central point of the discussion was a new insurance bill, currently under review by the Ministry of Law. The proposed legislation aims to modernize the regulatory framework by improving market access, simplifying business operations, promoting digitalization and product innovation, and strengthening supervisory powers for better policyholder protection.
The SECP also outlined other key initiatives, such as creating a consortium of insurance companies for agricultural coverage. This plan includes expanding crop insurance to all farmers, regardless of their borrowing status, through a public-private partnership model and increasing the categories of mandatory insurance.
Proposals to leverage modern technology were also a key focus, including suggestions for satellite-based assessments and digital claims processing systems. Improved data-sharing mechanisms were also highlighted as a way to enhance both transparency and operational efficiency in the sector.
The talks acknowledged that the low insurance uptake in the country necessitates greater product diversification and improved risk financing mechanisms. The ADB is working with other development partners, including the International Monetary Fund (IMF), on an integrated disaster risk financing framework for Pakistan.
Both the SECP and ADB reiterated their commitment to sustained collaboration aimed at strengthening the country’s insurance industry and enhancing its resilience against natural disasters.