Insurance industry ripe for big boost: Rajwana

Sector told to prepare for CPEC-induced expansion

LAHORE: Punjab Governor Malik Rafique Rajwana said on Tuesday that Pakistan’s insurance industry should prepare itself for some bigger challenges which could prove as a turning point for this underrated sector.

“Every challenge brings an opportunity for the individuals, businesses and nations. Pakistan is an emerging market and its on-going China Pakistan Economic Corridor (CPEC) project will definitely bring business for this sector, which currently contributes below 1% to national Gross Domestic Product”, said Rajwana, while addressing a seminar on good governance and the development of insurance industry. The seminar was jointly organized by Express Media Group and Federal Insurance Ombudsman.



The governor said that unfortunately there is mistrust between insurance companies and its clients. “Normally it took years and years for any effect to get their claims and many times insurance companies use delay tactics which further widens the mistrust,” he said and added that this industry needs ethics and most importantly the trust.

“The insurance policy is sensitive in the sense that it only materializes on trust, the person who agreed to take an insurance policy has no physical product with him,” he said.

He added that the Federal Insurance Ombudsman (FIO) is doing a great job but awareness needs to be spread across the country about insurance benefits and how a person can be helped by the department in case of any mismanagement by any insurance company.



The FIO Raeesuddin Paracha speaking at the occasion said that there are merely five percent of people in Pakistan who actually know what FIO really is and how it can help them to get their stuck claims.

“Each year almost 35,000 cases are being rejected by insurance companies and less than 10% people contact FIO against the mistreatment”, Paracha said.

He added that the insurance has a lot of potential in Pakistan and “all of our neighboring countries are ahead of us.”

“The scope of insurance is now expanding from life or general insurance to livestock, and other fields”, he said, adding that many people have doubt in mind regarding insurance.



Takaful is the best solution for them. “In the event of any loss, if the person knows them or their family, they will get their claims within days than they will go for the policy. “However, the situation is the opposite in reality”, he said.

Paracha further advised the insurance companies to prepare themselves for CPEC. “What I have observed is that industry is not ready for CPEC”, he said adding that all stakeholders should sit together and devise a policy and new products to gain maximum benefits and business uplift through CPEC.