Pakistan faces billions of rupees in losses every year due to floods and natural disasters. However, most development projects in the country remain uninsured. This gap leaves the economy vulnerable to repeated damage.
The International Monetary Fund (IMF) and Asian Development Bank (ADB) have urged Pakistan to improve its disaster insurance framework. They stress that better insurance coverage can help protect the country’s economy and development gains from future disasters.
Pakistan is ranked among the world’s top five most disaster-prone countries. Floods, earthquakes, and climate-related crises continue to impact communities and strain economic resources. The lack of sufficient insurance means the country suffers heavy financial losses after each event.
According to sources in the Finance Ministry, the IMF recommends making insurance mandatory for all new development projects. Without this safeguard, Pakistan risks losing billions in damages every year. The IMF highlights that a stronger insurance sector is essential to manage disaster risks.
The ADB also supports expanding access to insurance in Pakistan. It is reportedly working on a comprehensive plan to develop the country’s insurance industry further. The goal is to help Pakistan better handle economic shocks caused by natural disasters.
The Securities and Exchange Commission of Pakistan (SECP) regulates the insurance sector. However, the commission faces challenges such as a shortage of technical experts. These limitations slow down efforts to improve the insurance framework.
In conclusion, the IMF, ADB emphasize that strengthening disaster insurance is vital. It will help Pakistan reduce financial losses and protect vulnerable communities from the increasing threat of natural disasters.
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