The Securities and Exchange Commission of Pakistan (SECP) has announced that it is exploring options to reduce the outflow of foreign exchange related to reinsurance business.
The regulator recently held a roundtable attended by private and public sector non-life re/insurers, as well as representatives of the State Bank to address the growing trend in the export of reinsurance premium abroad, which is seen as impacting the country’s outflow of foreign exchange.
Various measures were deliberated upon by the expert committee as a means to reduce foreign exchange outflow and increase the retention of reinsurance premium in Pakistan, SECP reported.
These included the formation of a new local reinsurance company, the enhancement of paid-up capital requirements, obligatory minimum cession requirements, and the development of an online local underwriting portal to share risks among insurers.
The SECP said that it planned to take immediate steps based on the discussion, and would plan to hold similar consultation sessions with public and private sector re/insurers in future.
