Amendments to restrict forex outflow from insurance sector.

ISLAMABAD -- The SecuArities and Exchange ComAmission of Pakistan (SECP) on Wednesday proposed amendments to the Credit and Suretyship (Conduct of Business) Rules, 2018 for the insurance sector to restrict the outflow of money for reinsurance.

The draft amendments have been placed on the SECP's website for public opinion.

The amendments aim to delink reinsurance requirement of collateral to save foreign exchange.

The measure aims to facilitate the insurance industry in increasing local retention of insurance risks.

During stakeholder consultation session, it was poinAAted out that the current rules require procuring of collateral on guarantees/bonds of an amount equivalent to 80 per cent of the sum insured left after reinsurance.

The requirement has led to reduction of business and lessening of retention on credit and suretyship business, as most of the insurance sector tends to park their risk in the reinsurance business.

Since the...