SECP increases minimum paid-up capital for insurers
ISLAMABAD: The Securities and Exchange Commission of Pakistan (SECP) has increased the minimum paid up capital requirement for insurance companies.
A statement issued by the Commission here Tuesday said that the capital requirement was increase with the approval of SECP Policy Board. The Policy Board has approved an amendment to the Securities and Exchange Commission (Insurance) Rules, 2002 whereby the minimum paid up capital for both non-life and life insurance companies has been increased by an amount of Rs200 million.
A new rule 9 has been inserted in the said rules under which the baseline paid-up capital requirement for non-life and life insurance companies have been prescribed as Rs500 million and Rs700 million respectively.
Further, the amount of minimum paid up capital will be net off any discount offered on issue of shares. These new capital requirements would be applied in a phased manner and the existing insurance companies would be allowed a period of two years, i.e. till December 31, 2017 to meet the said requirement. At the time of enactment of the Insurance Ordinance, 2000, the minimum paid-up capital requirements for non-life and life insurance companies were Rs80 million and Rs150 million respectively. In the year 2007, the paid-up capital requirements for non- life and life insurance companies were increased to Rs300 million and 500 million respectively in a phased manner.