Amendments Proposed to Insurance Ordinance 2000 by the SECP
The Securities and Exchange Commission of Pakistan (SECP) has proposed a draft law to make amendments to the Insurance Ordinance 2000. The amendments refer to address regulatory gaps in the existing law and provide such an environment where market development can be encouraged.
The draft bill has been placed on the regulator’s official website for stakeholder and general public consultation.
This is the first time in the history that SECP is going to recognize InsureTechs. The changes aim to facilitate the use of technology and provide ease of doing business to everyone. It also focusses on the entity-specific and systemic risks by altering towards risk-based capital (RBC) and risk-based supervision (RBS) regimes.
The amendments are targeted to reinforce the regulatory framework and ensure its affiliation with the International Association of Insurance Supervisors (IAIS) on the Insurance Core Principles (ICP).
The significant reforms mentioned in the draft bill includes provision for the regulation of Takaful and re-Takaful; introduction of dedicated micro insurers; flexibility for the introduction of new intermediaries; regulation of reinsurance brokers; regulation of both local and foreign reinsurance business for the enhancement of local capacity; insurance self-network and insurance repository platform; provisions for regulation of index-based insurance and InsurTech.