SECP Report Highlights Opportunities in Pakistan’s Inclusive Insurance Market

Islamabad, The Securities and Exchange Commission of Pakistan (SECP) has released a comprehensive report on the country’s micro and inclusive insurance sectors, emphasizing the significant, yet largely untapped, potential for growth in these areas. The report, titled “Unlocking the Potential of Micro and Inclusive Insurance in Pakistan,” was unveiled at the recent International InsureImpact Conference, 2023, in Karachi.

According to Securities and Exchange Commission of Pakistan, the report provides a detailed analysis of the current state of inclusive insurance in Pakistan by comparing it with other jurisdictions, identifying gaps, and suggesting a future course of action. Findings from the report reveal that while 12.56 million insurance policies were issued through microfinance banks/institutions, 89 percent of these were for credit life insurance, highlighting a predominant focus on covering credit risks rather than offering broader insurance protections.

Commissioner of Insurance, Aamir Khan, emphasized the importance of inclusive insurance for enhancing overall insurance penetration in Pakistan. He noted that developing products and services that promote financial inclusivity is crucial for the growth of the sector.

The report identifies several challenges, including regulatory gaps and the need for improved product accessibility. It advocates for enhanced collaborative efforts to streamline processes, raise awareness, and focus on digital distribution channels. By partnering with Mobile Network Operators, microinsurance providers can utilize extensive networks and digital infrastructures to reach underserved populations.

The SECP recommends amending the Microinsurance Rules 2014 and fully leveraging technology to make inclusive insurance more accessible. It also suggests the creation of a synergy group involving insurance companies, InsureTech, and government bodies to ensure that the benefits of inclusive insurance reach the widest possible audience.

The full report is available for public access on the SECP’s website.