List Of Insurance Companies In Pakistan

Published Date: 02 Nov 2017

Insurance is a risk transfer mechanism. It’s a processes in which specialist (insurance companies) who handle the risk by spreading it over a large number of people or firms take on accountability for losses. Number of individuals agree to pay certain sums of money for protection against loss called premiums.

Importance of Insurance?

In this modern age of technology the most sought out thin after assurance of wellbeing is economic security. Insurance would be the most important tool certifying security. In order to financially and economically protect themselves man came up with life and non-life insurance.

Life insurance subject is people and to provide financial security to the deceased family is its objective. While non-life or general insurance covers all goods and property, this is done to put an individual back at the same financial level as he was before the loss occurred. To protect oneself the horrendous effects of personal or property loss due to disastrous events insurance is the best way to protect oneself. Anything that has risk associated with it should be insured so that a person can do their work freely. Insurance is always there to protect and provide financial security. The progress of man and insurance is interrelated, as insurance is a great source revenue also it helps control inflation and capital formation for country’s development.

List of Insurance Companies in Pakistan

I. Public sector 

1. National Insurance Corporation                                                         

2. Pakistan Reinsurance Company Ltd.

3. Postal Life Insurance

4. State Life Insurance Corporation Ltd.

II. Private sector

a) Incorporated in Pakistan

1. Adamjee Insurance Company Ltd.

2. Agro General Insurance Company Ltd.

3. Allianz EFU Health Insurance Company Ltd.

4. Alpha Insurance Company Ltd.

5. Amercian Life Insurance Company Ltd.

6. Asia Insurance Company Ltd.

7. Asian Mutual Insurance Company Ltd.

8. Askari General Insurance Company Ltd.

9. Beema Insurance Company Ltd.

10. Business & Industrial Insurance Company Ltd.

11. Capital Insurance Company Ltd.

12. Central Insurance Company Ltd.

13. Century Insurance Company Ltd.

14. Commercial Union Life Assurance Company

15. Co-operative Insurance Society of Pakistan Ltd.

16. Credit Insurance Company Ltd.

17. Crescent Star Insurance Company Ltd.

18. Dadabhoy Insurance Company Ltd.

19. Delta Insurance Company Ltd.

20. E.F.U.General Insurance Company Ltd.

21. E.F.U.Life Insurance Company Ltd.

22. East West Insurance Company Ltd.

23. Excel Insurance Company Ltd.

24. Gulf Insurance Company Ltd.

25. Habib Insurance Company Ltd.

26. Indus International Insurance Company Ltd.

27. International General Insurance Co. of Pak

28. Ittefaq General Insurance Company Ltd.

29. Jupiter Insurance Company Ltd.

30. Metropoliton Life Assurance Company Ltd.

31. Muslim Insurance Company Ltd.

32. National General Insurance Company Ltd.

33. New Jubilee Insurance Comapny Ltd.

34. North Star Insurance Company Ltd.

35. Orient Insurance Company Ltd.

36. Pakistan General Insurance Company Ltd.

37. Pakistan Guarantee Insurance Company Ltd.

38. Pakistan Mutual Insurance Company Ltd.

39. Platinum Insurance Company Ltd.

40. Premier Insurance Company Ltd.

41. Prime Insurance Company Ltd.

42. Raja Insurance Company Ltd.

43. Reliance Insurance Company Ltd.

44. Seafield Insurance Company Ltd.

45. Security General Insurance Company Ltd.

46. Shaheen Insurance Company Ltd.

47. Sliver Star Insurance Company Ltd.

48. Union Insurance Company of Pakistan Ltd.

49. United Insurance Company of Pakistan Ltd.

50. Universal Insurance Company Ltd.

b) Incorporated abroad

1. ACE Insurance Aid Pacific Ltd.

2. CGU Assurance Company Ltd.

3. New Hampshire Insurance Company Ltd.

4. New Zealand Insurance Company Ltd.

5. Royal & Sun Alliance Assurance plc.

Insurance association Pakistan

The Insurance Association of Pakistan is a place where members can exchange their information, knowledge, experience and statistics.

By August 2012 the composition of Membership of the Insurance Association of Pakistan was 38 and they are as follows:

30 Non-life insurance companies (28 Pakistani and 2 foreign).

7 Life Insurance Companies (5 Pakistani & 1 Foreign) and a state-owned Re-insurer (PRCL) in Pakistan.

The job of the association is to encourage, provide backing and safeguard the status, mutual interest and prosperity of insurance Companies in Pakistan. IAP can act on the behalf of the members whenever their interest is affected.

IAP has set a road map, 5 year plan to achieve its objective which are as follows:

To develop strict code of conduct that all IAP members have to follow strictly.

Making sure that IAP members comprehend the regulatory requirements. So that they can better manage their business.

To launch an insurance campaign to tell the public about the benefits of different products and customer service quality.

Making sure that in the future Insurance industry are satisfactorily met.

Putting a stop to fraudulent or unrecognized insurance representatives.

REINSURANCE

As the insurance business evolved significantly, the insurance companies realized that they were committed to large amounts, which they had insured. These companies understood that if a natural disaster or a calamitous damage would occur, they would go out of business as paying such a huge sum at a short notice would be almost impossible.

This dilemma led to the realization of the need of reinsurance. This need was translated into the formation of specialist reinsurance companies. It is a requirement of the law in almost every country that each insurance company has to be reinsured prior to commencing business and dealing with massive insurance claims. Insurance Executive of SECP grants the license to insurance companies after these companies meet the requirements of reinsurance arrangements to safeguard the interests of policy holders.

However, the same risks apply to the reinsurance companies as well i.e. commitment to huge sums having been insured and chance of bankruptcy exists there too, so the reinsurance companies need to be reinsured also. So these companies further reinsure themselves with other reinsurers. This ongoing reinsurance cycle creates a vast network of reinsurance across several countries which divides the risk over a lot of companies and saves each individual company the risk of bankruptcy in a severe situation. When a claim arises, each reinsurer pays its share to the claim. So, reinsurance can be thought of as the spinal cord of insurance.

Pakistan Reinsurance Company Limited

In the past Pakistan Reinsurance Company Limited (PRCL) was called the Pakistan Insurance Corporation (PIC). Under PIC Act 1952, PRCL was inaugurated in 1952 as Pakistan Insurance Corporation. The main purpose was to assist the domestic insurance industry and cater to the needs of the non-life insurance companies. It is the only reinsurance organization that operates in Pakistan.

Pakistan Reinsurance Company Limited is a publicly owned company operating under the managerial control of the Ministry of Commerce. A Chairperson heads the company along with the support of a robust professional team. The team is responsible for managing the business matters of the company effectively and efficiently. The Board of Directors oversees the company. The members of the Board of Directors include seven members which are nominated by the Federal Government while the remaining are elected by the shareholders who have outstanding reputation among the business community.

Pakistan Reinsurance Company Limited’s basic aim is the progress of insurance and reinsurance business in Pakistan’s economy. It supplies insurance plans to various divisions namely Marine Cargo, Fire, Accident, Aviation, Marine Hull and Engineering. PRCL is a nationwide reinsurer performing a major role in the economic development of Pakistan. The company offers reinsurance protection to the domestic insurance industry in consideration of treaty and facultative business along with management of the insurance plans the Federal Government of Pakistan assigns.

PRCL has its head office in Karachi, Pakistan while its zonal office is located in Lahore. 18% of PRCL’s share is held by insurance market while 45% of the share is held by the reinsurance protection in Pakistan.

Objectives of Pakistan Reinsurance Company Limited

Providing paramount insurance solutions to the domestic insurance industry so as to inspect outflow of foreign exchange as much as possible

Developing good corporate associations with other reinsurers

Training its staff in accordance with the dynamic market environment

Providing the staff with the best possible working environs

Partaking risks and conserving resources through the stipulation of reinsurance services to the insurance companies

Assisting in the growth of the nationwide insurance industry

Enhancing local retention capacity in Pakistan so as to protect treasured foreign exchange

Performance of Pakistan Reinsurance Company Limited

The asset base improved slightly by 2% from December 2012 to March 2013 while the investments rose by 6.25%. During the same time period, the gross premiums rose by 17% while the net premiums rose by 7.3%. The major reason behind the rise in net premiums is that the company sustained a high premium retention with the support of its strong equity base. As the returns on investments improved, the profitability soared up by 63 percent during December 2012 to March 2013.

PROFILE OF REINSURANCE

BILLION RUPEES

CY08

CY09

CY10

CY11

CY12

CY13*

Equity

7.3

6.8

6.4

6.4

6.6

6.9

Investments

5.5

5.5

4.7

5.8

6.4

6.8

Gross Premiums

4.6

5.8

6.6

6.9

8.2

9.6

Net Premiums

1.9

2.2

2.9

3.5

4.1

4.4

Net Claims

1

0.9

1.7

2

2.2

0.7

Expenses

0.3

0.2

0.3

0.4

0.5

0.5

Profits

0.9

0.3

0.5

0.8

1.1

1.8

Assets

12.5

12.4

12.5

12.9

14.6

14.9

*Data corresponds up to March 2013

REGULATIONS

Insurance Ordinance 2000

These laws make it obligatory for insurance companies to get reinsured and that at least one of the reinsurers should be a foreign entity.

Insurance Rules 2002 (inclusive of the modifications in the Insurance Rules 2002 (Mar 05, 2009))

SECP Insurance Rules 2002

Companies Ordinance 1984

RISKS

Pakistan is a country where natural disasters strike very often. Therefore the major risk that companies face is loss risk both in terms of frequency and severity. In calamitous situations, it is critical to have support of favorable conditions from the reinsurance company.

As the table shows, major disasters have occurred in the past with the flood being the most frequent and causing the most damage. During catastrophic times, claims soar up and insurance companies can go bankrupt if the risk is not properly managed through reinsurance network. So, basically loss risk is associated directly with the claims.

Apart from loss risk, insurance companies face risk of unexpected rise in operating expenses and risk of unexpected fall in investment yields. Both these risk affect the company’s profitability.

YEAR

DAMAGES (US$ Million)

DISASTER

2012

Est. 2, 631

Flood

2011

3, 730

Flood

2010

9, 500

Flood

2008

103

Flood

2007

1, 620

Cyclone

2007

327

Flood

2005

5, 200

Earthquake

2001

246

Flood

1999

247

Drought

1992

1, 000

Flood

1976

505

Flood

1973

662

Flood