On Jul. 30, PAK SEC issued directive re product illustration format.
PAK SEC published Directive for life insurance and family Takaful illustrations, 2024.
Aims to enhance transparency of product illustrations via improved disclosures on matters, e.g., charges, simplify them to help potential policyholders' understanding.
PAK SEC published a press release in relation to the Directive on the same day.
Directive
To standardize illustrative values in policy presentations, enhance understanding, and prevent misleading information; applicable to individual life insurance products with terms of over one year that offer cash values upon surrender or maturity.
Insurers must provide policy illustrations in both English and Urdu; clearly explaining terms and projected values; new product illustrations must be included in filings.
Existing products must be certified for compliance by officers by Jan. 31, 2025.
Insurers must disclose historical returns of funds over last five years; proposal forms must be accompanied by illustration, without which proposal cannot be processed.
Terms like Takaful and insurance have been used interchangeably for consistency.
Effectiveness
The directive is effective from Jan. 1, 2025.
Regulators
PAK SEC
Entity Types
Ins
Reference
RF, PR, 7/30/2024; Nt S.R.O. 1088(1)/2024, 7/8/2024
Functions
Actuarial and Valuation; Compliance; Financial; Legal; Product Administration; Product Design; Record Retention; Reporting; Sales Practices
