Insurance Association of Pakistan (IAP) on Wednesday said insurance companies are a vital component of the economy which must be officially included in the list of essential service so that it can remain open during this period of lockdown on account of the coronavirus pandemic.
Insurance sector not only provide security to business assets worth trillions of rupees but also give businesses and individuals the sense of security that they will be protected in case of any misfortune or catastrophe, it said.
IAP will soon start working on providing specialised insurance covers for business interruption due to events beyond the control of any individual or organisations such as the global pandemic we are currently facing, said Muhammad Hussain Hirji, Chairman IAP.
Talking to Dr. Murtaza Mughal, Convener of FPCCI Central Standing Committee on Insurance, he said that we are experiencing great difficulty in providing businesses and individuals with the service and support that they expect from the insurance industry, therefore we should be allowed to operate.
He said that the insurance industry is an important part of the financial system which should be allowed to operate amid lockdown to provide cover to the vital economic areas as the business community is facing heavy losses due to interruption.
Insurance turns accumulated capital into productive investments, it helps mitigate losses, ensures financial stability and promotes trade and commerce activities which result in economic growth and development, he added.
Muhammad Hussain Hirji said that insurance plays a crucial role in the sustainable growth of an economy while granting peace of mind to policyholders.
At the occasion, Dr. Murtaza Mughal said that insurance sector should be declared as an essential service to work with the minimum required staff which will help minimise the loss of businesses and jobs during these tough times, he added.
Apart from businessmen and policyholders, banks are facing problems due to closure of insurance business which helps them to fulfil their legal and regulatory obligations, he added.
The authorities should direct the insurance industry to immediately launch new products to cover losses resulting from pandemic and lockdown as standard policies did not include forced closure by the government, he informed.
The world is full of uncertainties and risks. Individuals, families, businesses, properties and assets are exposed to different types and levels of risks. While it is not always possible to prevent unwanted events from occurring, insurance is a financial product that reduces or eliminates the cost of loss, he said.
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Dr. Murtaza Mughal
Cell: 0321-5157671
President Pakistan Economy Watch
Convener FPCCI Central Standing Committee on Insurance
