Pakistan’s insurance coverage remains low despite industry growth

September 15, 2026 (MLN): Pakistan’s insurance industry is growing, but insurance penetration remains extremely low, CEO State Life Shoaib Javed Hussain said.

He said 42 insurance companies are operating in Pakistan, with total sector assets reaching Rs4 trillion and annual insurance premiums standing at Rs708 billion. Insurance companies have collectively paid around Rs450bn in claims.

Despite the sector’s growing size, insurance penetration stands at only 0.7% of GDP, while insurance premiums are increasing by around 15% annually. Digital channels account for just 0.8% of insurance premiums.

Shoaib Javed Hussain said life insurance and family takaful have total assets of Rs3.30tr, with annual premiums of Rs462bn and Rs373bn in claims paid. He said 63% of life insurance and family takaful premiums are linked to the public sector.

Conventional insurance accounts for 85% of the life insurance market, while family takaful accounts for 15%. Agency networks dominate the public sector, while the private sector uses various channels, including bancassurance.

Shoaib Javed Hussain said non-life insurance and general takaful have annual premiums of Rs245bn and total assets of Rs720bn, while companies in the segment have paid Rs70bn in claims. He said 91% of non-life insurance premiums are linked to the private sector.

He said the insurance industry is important for long-term savings, health protection, pensions and family financial security, adding that insurance must be promoted as an effective means of long-term investment and national economic stability.

Meanwhile, CEO TPL Insurance Muhammad Aminuddin said 97% of vehicles in the country are operating without insurance.

He said the SECP’s third-party motor insurance initiatives will enable all vehicles to have insurance coverage by 2030.

Muhammad Aminuddin said artificial intelligence is rapidly transforming business processes worldwide and the insurance industry must adopt AI and advanced technology to remain competitive. He said AI can improve insurance products, risk assessment and the claims payment system.

Separately, CEO EFU Life Muhammad Ali Ahmed said assets under management of pension funds in Pakistan have reached Rs156 billion, increasing by 333% since January 2021.

He said Pakistan has a working-age population of 134.4 million, while the number of people aged 60 years and above stands at 13.5 million. He said 72.1% of employment in the country is in the informal sector.

Shoaib Javed Ahmed said active accounts under voluntary pension schemes stood at only 143,000 as of December 2025, despite the country’s large working-age population.

He said Pakistan needs to expand government, employer-sponsored and individual pension systems, while voluntary pension schemes and insurance-based long-term savings can play an important role in retirement security.

Shoaib Javed Ahmed said annual annuities, phased withdrawals and other retirement income products need to be promoted.

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