The Securities and Exchange Commission of Pakistan’s Policy Board approved significant amendments to the insurance regulatory framework, updating the Insurance Rules, 2017, the Insurance Accounting Regulations, 2017, and the General Takaful Accounting Regulations, 2019. The changes are positioned to strengthen resilience, address sector challenges, diversify capital sources and streamline reporting requirements. Minimum paid-up capital requirements would increase to PKR 2,000 million for non-life insurers and PKR 3,000 million for life insurers, with implementation phased through to 2030. The package also introduces an enabling framework for insurers to issue subordinated debt instruments and specifies their solvency treatment, linking the reform to the Securities and Exchange Commission of Pakistan’s planned implementation of a Risk-Based Solvency Regime. Additional amendments standardise the recording of advance and withholding tax in life insurers’ financial statements, relax a requirement to hold a specified percentage of government securities against advance/withholding tax, and allow non-life insurers with substantial Takaful operations to present full Takaful results alongside conventional results with supporting notes detailing conventional and window Takaful breakdowns.
Securites & Exchange Commission of Pakistan 2025-02-28
Securities and Exchange Commission of Pakistan approves insurance framework amendments including paid-up capital hikes to PKR 2,000 million for non-life and PKR 3,000 million for life insurers
The Securities and Exchange Commission of Pakistan’s Policy Board approved amendments to the insurance regulatory framework, enhancing resilience and diversifying capital sources. Changes include increased minimum paid-up capital for insurers, phased Risk-Based Solvency Regime implementation, and a framework for subordinated debt instruments. Amendments also standardize tax recording in life insurers’ financial statements and adjust government securities holdings requirements.