Securities and Exchange Commission of Pakistan (SECP) has taken a significant regulatory step toward modernizing the insurance sector by issuing new formats for Published Financial Statements applicable to both life and non-life insurers. This initiative, announced through notification SRO 1917(I)/2025, will come into effect once International Financial Reporting Standard 17 (IFRS 17) becomes operational in Pakistan. The change aims to harmonize financial reporting across the insurance industry with international best practices, enhancing transparency and comparability for investors, regulators, and other stakeholders.
The updated reporting framework requires insurers to adopt standardized formats for their financial statements, ensuring consistency and clarity in financial disclosures. According to the SECP, life insurers will be obligated to submit a Statement of Financial Position, Statement of Comprehensive Income, Statement of Changes in Equity, and Statement of Cash Flows in the newly prescribed formats. In addition, they must provide Disclosure 100 and Disclosure 101 under IFRS 17 for each class of business defined in Section 4(1) of the Insurance Ordinance.
The SECP has clarified that the accompanying notes to these statements must align with International Financial Reporting Standards (IFRS) and incorporate segmental information in the prescribed template. Annexure II of the Insurance Rules 2017 will be amended to replace existing forms and notes (1–51) with updated versions for life insurers. This will bring financial disclosures in line with the structural and informational requirements established under IFRS 17, which focuses on providing a more faithful representation of insurance contract liabilities and performance.
Similarly, non-life insurance companies will need to comply with identical requirements for financial reporting. This includes filing Statements of Financial Position, Comprehensive Income, Changes in Equity, and Cash Flows, along with the mandated IFRS 17 disclosures. Non-life insurers must also report on each major class of business listed in Regulation 22 of the Insurance Accounting Regulations 2017, ensuring greater transparency in how different insurance lines contribute to overall performance.
IFRS 17 represents a major shift from the previous accounting standards, introducing a more consistent framework for measuring and presenting insurance contract obligations. By adopting this standard, Pakistan’s insurance sector is expected to attract greater investor confidence, enable clearer financial analysis, and provide better comparability with international insurance companies.
The SECP’s decision aligns with its broader regulatory agenda to strengthen corporate governance, improve financial sector oversight, and modernize reporting systems in line with global standards. The regulator has also emphasized that these reforms are expected to support a more robust and well-regulated insurance industry capable of meeting evolving market and investor demands.
Once implemented, insurers will need to upgrade their internal financial reporting systems, enhance disclosure processes, and ensure compliance with the updated regulatory requirements. Industry experts believe that this will also encourage insurers to adopt advanced digital accounting systems to meet the more complex disclosure obligations under IFRS 17.
The move is viewed as a critical milestone in bringing Pakistan’s insurance market in line with global financial reporting standards, enhancing the sector’s competitiveness and resilience in a rapidly changing financial environment.
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