The Securities and Exchange Commission of Pakistan (SECP) has proposed a significant increase in the minimum paid-up capital requirements for insurance companies under its “Insured Pakistan” initiative. The proposed changes call for non-life insurers’ minimum capital to rise from PKR 500 million to PKR 2 billion and life insurers from PKR 700 million to PKR 3 billion, effective immediately for new insurers and phased in for existing insurers over four years. This increase aims to enhance the financial stability of the insurance sector, protect policyholders, and improve the local industry’s ability to manage larger risks. The SECP noted that the existing capital requirements were last adjusted in 2017, and this move may lead insurers to consider raising capital or pursuing mergers and acquisitions.
