The Securities & Exchange Commission of Pakistan (SECP) has formed a technical working group to develop a preliminary model for a risk-based capital regime for the insurance sector. This work is to be completed by 30 June 2022.
The regulator says this in its 2021 annual report released in May 2022. The SECP added, "The graduation of the insurance sector in Pakistan from factor-based capital requirements to risk-based capital requirements will help increase the resilience of the insurance sector towards risks faced by it and improve its compliance with the international standards."
The SECP annual report also outlines several regulatory developments in the insurance sector. These include:
Draft Insurance Ordinance (Amendment) Bill, 2020
The Draft Insurance Ordinance (Amendment) Bill, 2021 has been formulated with the objective to introduce significant reforms in the primary insurance law. After extensive consultation with the industry stakeholders and obtaining necessary regulatory approvals, the draft Bill will be submitted to the Ministry of Finance to begin the legislative process.
Registration Regime for Dedicated Micro Insurers and Digital-Only Insurers
In line with the SECP’s agenda of promoting digitalisation in financial services and enhancing financial inclusion, a registration regime is proposed to be introduced for entities desirous to transact insurance on a digital-only basis and entities desirous to transact small-ticket-size insurance i.e. microinsurance....
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