INTERVIEW OF HASANALI ABDULLAH, MANAGING DIRECTOR EFU GENERAL INSURANCE LTD.
Sep 19 - 25, 2011
PAGE:TELL US SOMETHING ABOUT YOURSELF?
HASANALI ABDULLAH: I am a Chartered Accountant by profession. I joined EFU General in 1979 and from July of this year, I am the Managing Director of the company. I am also director of other companies of the group i.e. EFU Life Assurance Ltd and Allianz EFU Health Insurance Ltd. I was Chairman of Chairman of Insurance Association of Pakistan in 2008 and in 2010-11.
PAGE: HOW WOULD YOU COMMENT ON THE IMPACT OF POOR ECONOMIC PERFORMANCE ON INSURANCE SECTOR?
HASANALI ABDULLAH: Insurance business is totally linked with the industrial and commercial activities of the country. For last few years, there is almost no industrial growth, rather industries are closing down or working below their capacities. The main reasons are shortage of gas and electricity and law and order. Further, banks have controlled advances due to increase in nonperforming advances. The consumer financing by banks and nonbanking financial institutions has also reduced considerably. This has also impacted production of vehicles in the country. At the current rate of markup, it is too costly for the borrower. The insurance sector however continues to grow by improving the services to its customers and advising them to appropriately and adequately insure their assets. In view of the terrorisms risks world over, new line or terrorism business is developing and is sold in Pakistan market. Banks are also insisting for this cover against their loans.
PAGE: YOUR VIEWS ABOUT PROSPECTS OF INSURANCE SECTOR?
HASANALI ABDULLAH: As I mentioned earlier, it is linked with industrial and commercial activities of the country. SECP is in the process of developing microinsurance rules in consultation with insurance industry, microfinance banks, State Bank of Pakistan, related stakeholders and NGOs etc. The stock market performance has improved and corporate results are also improving. This would have positive impact on investment incomes for insurance companies.
PAGE: ARE YOU CONTENT WITH THE GOVERNMENT'S SUPPORT TO THE INSURANCE SECTOR?
HASANALI ABDULLAH: Insurance companies are being regulated by securities & exchange commission of Pakistan's insurance division. Since inception of this division, insurance industry has benefited because of the well coordinated efforts by SECP and insurance association of Pakistan. All important decisions by SECP are taken after consultation with IAP. I understand that window operations for Takaful business would be allowed to conventional insurance companies soon. It is for the first time that SECP has appointed commissioner for insurance, who is also a chartered insurer from the private sector which would help in development of insurance sector.
PAGE: WHAT IS THE LEVEL OF COMPETITION IN THE INSURANCE SECTOR?
HASANALI ABDULLAH: The Pakistan market is non-tariff market. The companies determine their rates of premium based on the experience and assessment of risk. Competition is always good for any business. It makes the companies efficient and innovative.
PAGE: WHAT MUST BE DONE TO ATTRACT INVESTMENT IN INSURANCE SECTOR?
HASANALI ABDULLAH: Investment in insurance sector would automatically increase when the industrialization is in full swing. Industries operate on full capacities. There is an improved law and order situation and increase in tourism activities in various parts of Pakistan.