Insurance Sector in Pakistan

In: Business and Management

Submitted By ubaidurrahman
Words 611
Pages 3
As of November 07, 2007 there were 637 companies which were listed on Karachi Stock Exchange with a total market capitalization of Rs. 4121 billion (66 billion $). This figure has registered an increase now and our Karachi Stock Market is approximately US$ 72 billion. Out of this financial sector constitutes 41% of the total market capitalization of Karachi Stock Exchange. However, the Insurance Sector is a small one and needs immediate attention for its growth, development and rapid expansion to meet the challenge of 21st Century for accelerating socio-economic growth of Pakistan with an emphasis on wider prosperity.

Insurance Sector has registered a very slow growth in the history of Pakistan. Based on our research, the following conclusions emerge:
1. Listed insurance sector on Karachi Stock Exchange in terms of companies is only 4.4%.
2. Share of listed insurance sector on total listed companies on Karachi Stock Exchange is only 1.41%.
3. Out of 637 listed companies, only 29 relate to insurance sector.
4. From the birth of Pakistan till now we have added only 29 listed companies- giving us a ratio of less than 0.5 per company per year.
5. Turnover for 10 months (January – October 2007) on the Karachi Stock market was only 1.55% of the total turnover.

6. Share of insurance sector on listed companies on Karachi Stock Exchange is only 3.83% in respect of Market Capitalization.
7. Share of insurance in GDP of Pakistan is only 1.80%. Ten percentage companies’ shares are listed below par. Therefore, these are sick. They need revival.
8. In the case of life insurance there is a vast scope. State Life Insurance Corporation of Pakistan should be immediately privatized. Their Mission Statement should be reviewed and revisited and on war-footing Insurance Policy of a vibrant nature should be developed so that Insurance Sector starts serving the economy of the…...

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