SECP Increases Minimum Paid-Up Capital Requirement for Insurance Companies

The Securities and Exchange Commission of Pakistan (SECP) has substantially enhanced the minimum required amount of paid-up capital for insurance companies including existing life insurers and non-life insurers. According to S.R.O.1588(I)/2024 issued by the SECP, the amount in the notification given shall be the minimum required amount of paid-up capital for an existing life insurer and non-life insurer registered under the Ordinance to carry on insurance business. Under the enhanced requirements, the minimum paid-up capital requirement for a life insurer would be Rs. 1,000 million for the year 2025 and the minimum paid-up capital requirement for a non-life insurer would be Rs. 800 million for the year 2025. Prior to December 31, 2025, the minimum paid-up capital requirement for a life insurer was Rs. 700 million whereas the minimum paid-up capital requirement for a non-life insurer is Rs. 500 million. The minimum paid-up capital requirement for an insurer who, after the insertion of this rule, desires to register itself, shall be Rs. 3,000 million for a life insurance business and Rs. 2,000 million for a non-life insurance business. The SECP has also mentioned the amount given which shall be the minimum required amount of paid-up capital for a micro insurer and digital-only insurer, registered under the Ordinance to carry on insurance business. The minimum paid-up capital requirement for a life microinsurer would be Rs. 150 million; non-life microinsurer Rs. 80 million; life digital-only insurer Rs. 250 million and the minimum paid-up capital requirement for a non-life digital-only insurer would be Rs. 100 million. The life digital-only insurer shall have a minimum paid-up capital in accordance with the requirement of sub-rule (2) of rule 11; Provided that where any life digital-only insurer is underwriting life insurance saving products, before the insertion of this clause, the minimum paid-up capital shall be in accordance with the requirement of sub-rule (1) of rule 11, SECP added.