Govt unveils major insurance sector reforms under new bill 2026

May 19, 2026 (MLN): The government has decided to increase competition and investment in the insurance sector, presenting the Insurance Bill 2026 in the National Assembly with major reforms proposed.

The new legislation aims to fully open the insurance sector to foreign investment and replace the 25-year-old Insurance Ordinance.

Measures have been proposed to ensure faster settlement of insurance claims and swift resolution of disputes.

Under the bill, foreign insurance and reinsurance companies will be allowed to operate in Pakistan through branch structures, while the private sector will be included in the insurance of public assets.

Private reinsurance companies will also be given equal opportunities in mandatory reinsurance.

The bill proposes legal recognition for technology-based distribution models and insurtech products.

The SECP has proposed a permanent licensing system instead of repeated renewals, along with strict timelines for claim settlements and strong measures against misleading insurance sales.

A risk-based capital framework and solvency management system have also been proposed for insurance companies.

SECP Chairman Dr. Kabir Sidhu said a stable insurance sector is essential for sustainable economic growth, adding that the new bill will provide protection to citizens, businesses, industry, and agriculture, while digital platforms will enable low-cost and faster insurance delivery.

Copyright Mettis Link News