The Securities and Exchange Commission of Pakistan (SECP) has got down to provinces for the digitization of the death certificate system to facilitate heirs of life insurance policyholders to get their insurance claims without any problem.
The SECP has also commanded insurance companies to make a platform with the National Database and Registration Authority (Nadra) as a result information about a policyholder’s death could be easily available to the companies in the minimum time and death claims could be automatically instigated.
Moreover, SECP Commissioner Insurance Sadia Khan, in a letter to Punjab and Sindh governments, stated that there was a prerequisite to ease the heirs of insurance policyholders and the issuance of death certificates has to be digitized in collaboration with Nadra.
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All at once, the SECP has also directed the life insurance companies to plan a mechanism so that particulars of a policyholder’s death could be received by them from Nadra automatically.
“The timely availability of credible death information can enable speedy claim payment to the life insurance beneficiaries,” the SECP letter said.
The letter continued that the life insurance gave financial safety to the family of a policyholder following the death of the employee. However, due to the small literacy levels in Pakistan, the inheritors of life insurance policyholders were usually ignorant of the existence of a life insurance policy acquired by the deceased.
“Even if aware, getting a death certificate was a difficult task for the bereaved widow and children, especially in the rural areas,” the SECP noted.
While answering a question, a senior SECP official stated, “The streamlining of the claims would also encourage life insurance in the country.”
“Delays in payment of claims benefit the insurance companies as they retain the amount in their bank accounts,” he added.
Presently, 10 active life insurances companies are registered with the SECP in the country, including Askari Life Assurance Company Limited, Adamjee Life Assurance Company Limited, Dawood Family Takaful Limited, IGI Life Insurance Limited, Jubilee Life Insurance Company Limited, EFU Life Assurance Company Limited, Pak-Qatar Family Takaful Limited, TPL Life Insurance Limited, State Life Insurance Corporation of Pakistan, and the Postal Life Insurance Company Ltd.