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SECP fixes growth rate for life insurance and family takaful at 7%, 9%, 11% for 2015

SECP fixes growth rate for life insurance and family takaful at 7%, 9%, 11% for 2015

ISLAMABAD: The Securities and Exchange Commission of Pakistan (SECP) has specified growth rate scenarios for life insurance and family takaful illustration at 7pc, 9pc and 11pc for 2015.

The SECP specified the growth rate scenarios through a circular. Life insurance and family takaful product illustration is an integral part of the overall sales process. It helps enhance transparency, provides better understanding of the product to prospective policyholders and enables them to make informed decisions as well as compare various life insurance and family takaful products.

Life insurance and family takaful companies use three growth rate scenarios to demonstrate projected benefits to potential policyholders. The SECP specifies these scenarios based on long-term interest rate outlook prevalent in Pakistan after consultation with the Pakistan Society of Actuaries (PSA).

In January 2014, the SECP had specified three scenarios for the rates of return assumption as specified for 2014 through circular No. 1/2014 of January 7, 2014. For 2015, the SECP has decided that there should be no change in these scenarios.

Meanwhile, SECP team has left for Dubai for consultation with the Assessment Committee Review Team. The Securities and Exchange Commission of Pakistan (SECP) in its ongoing commitment to ensuring the highest standards of capital market regulation in line with the best international standards and practices, had submitted a detailed self-assessment of Pakistan’s capital markets to the International Organization of Securities Commissions (IOSCO).

The Assessment Committee Review Team (RT), comprising six jurisdictions, i.e. Australia, Dubai, Luxembourg, Saudi Arabia, Spain and Turkey led by an external consultant from the UK has completed its desk-based research of SECP’s report. The SECP team along with representatives from the relevant market infrastructure institutions has proceeded to Dubai for consultation meeting, following which a final report will be published by the RT after due deliberation and approval of the IOSCO Board. The final report would include a recommended roadmap for enabling Pakistan to achieve full implementation of all IOSCO principles.