Pakistan's Federal Government has introduced the Insurance Bill, 2026, in the National Assembly to make insurance services simpler, faster and more accessible for citizens through digital platforms.
The legislation, proposed by the Securities and Exchange Commission of Pakistan (SECP), seeks to replace the 25-year-old Insurance Ordinance, 2000, and facilitate quicker claim settlements and stronger consumer protection mechanisms.
The proposed law is also expected to attract investment, promote competition and support the development of affordable and modern insurance products in Pakistan, where the sector has long struggled with low penetration, outdated regulations and limited innovation.
Under the proposed law, insurance services are expected to become simpler, faster and more accessible for the public through digital onboarding, tech-driven insurance products and streamlined regulatory procedures.
Some key reforms covered in the Insurance Bill, 2026, include:
- Market liberalisation: Opens Pakistan’s market to foreign insurers and reinsurers through branch structures.
- Private sector growth: Allows private sector participation in public property insurance and grants private reinsurers the first right of mandatory reinsurance.
- Digital transformation: Introduces tech-driven distribution models, flexible intermediary structures and formal recognition for emerging InsurTech products.
- Ease of doing business: Replaces periodic renewals with perpetual licensing and simplifies regulatory filing processes.
- Enhanced policyholder protection: Mandates stricter claims-handling timelines, rigorous mis-selling safeguards and transparent dispute resolution mechanisms.
- Financial resilience: Implements a risk-based capital framework alongside early corrective action mechanisms for solvency management.
The SECP has been closely collaborating with federal ministries, parliamentary committees and stakeholders to build consensus and ensure a smooth legislative transition and effective implementation of the proposed reforms.
According to SECP Chairman Dr Kabir Ahmed Sidhu, insurance plays a critical role in protecting households, businesses and the broader economy from financial shocks. Dr Sidhu also noted that the Insurance Bill, 2026 is a key step toward enhancing insurance penetration in Pakistan by enabling affordable insurance products through digital platforms for all segments of society.