Pakistan has significant potential to expand inclusive insurance coverage, which could strengthen financial protection for underserved communities and contribute to progress toward the Sustainable Development Goals (SDGs), speakers said during a talk series organised by the Securities and Exchange Commission of Pakistan (SECP). The discussion focused on the role of insurance in protecting individuals and businesses from financial shocks and examined how affordable products, simpler processes and wider access could help increase participation in the insurance sector. The session brought together representatives from the insurance industry, development sector, academia and SECP to discuss ways of making insurance more accessible to segments of the population that remain underserved by formal financial services.
Michael J. McCord, managing director of the MicroInsurance Centre, said Pakistan has considerable market potential for inclusive insurance, particularly among underserved communities. He highlighted the need for insurance providers to develop products that address the specific circumstances and financial capabilities of customers. Inclusive insurance can provide protection to people who may have limited savings or financial resources to absorb unexpected losses, making affordability and accessibility important considerations in expanding coverage. The discussion emphasized that insurance products need to be relevant to the risks faced by different customer groups rather than relying on complicated products that may be difficult for customers to understand.
SECP Commissioner Insurance Imtiaz Haider said microinsurance can play an important role in protecting low-income groups, farmers and small businesses against financial losses arising from illness, disasters and other unexpected events. He said financial shocks can force vulnerable households and business owners to sell assets to meet immediate expenses, potentially affecting their longer-term financial stability. According to Haider, affordable risk protection is therefore an important component of broader financial inclusion. Expanding access to suitable insurance products could allow individuals and small businesses to manage certain risks without having to rely entirely on personal savings or the sale of productive assets when unexpected financial needs arise.
McCord also stressed that insurance products intended for underserved communities should be designed around customers’ needs, remain affordable and be easy to understand. Clear product structures and accessible information can help customers understand what protection they are purchasing, what circumstances are covered and how claims can be made. He further highlighted the importance of timely claims payments in developing public confidence in insurance. According to McCord, efficient claims handling, combined with the use of digital technology, can contribute to greater trust among customers and strengthen the reputation of the insurance industry.
Digital technology was also identified as an important component of efforts to broaden insurance access. Digital platforms can help simplify interactions between insurers and customers, improve the delivery of services and support more efficient regulatory processes. For underserved communities, digital channels could provide additional ways to access insurance information and products, particularly where conventional insurance distribution networks have limited reach. However, the emphasis during the session remained on ensuring that technology supports simple, understandable and customer-focused insurance solutions rather than adding complexity to the process.
SECP Chairman Dr. Kabir Ahmed Sidhu said the commission is working to expand the insurance market through digitalization of the regulatory system and the introduction of simpler insurance products. He said efforts to modernize regulatory processes are intended to support the development of the insurance sector while making it easier for customers to access suitable products. Sidhu also highlighted the Insurance Bill currently pending before Parliament, describing it as a potential milestone for the modernization and development of Pakistan’s insurance industry.
The Insurance Bill is being discussed in the context of broader efforts to strengthen the regulatory and operational framework for the sector. Alongside regulatory modernization, speakers at the SECP session emphasized that product affordability, customer understanding, efficient claims payments and appropriate use of digital technology will remain important for expanding insurance coverage. These factors are particularly relevant for farmers, small businesses and low-income households that can face significant financial consequences from unexpected events but may have limited access to conventional insurance products.
Representatives from the insurance industry, development sector, students and SECP officials attended the session, providing perspectives from different parts of the financial and insurance ecosystem. The discussion highlighted the opportunity to develop a more inclusive insurance market by addressing affordability and accessibility while improving customer confidence. With regulatory digitalization and potential legislative changes underway, the SECP is seeking to support the development of insurance products that can provide practical financial protection to underserved communities and strengthen the role of insurance within Pakistan’s wider financial inclusion efforts.
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