Mar 5 - 11, 20

The State Life Insurance Corporation (SLIC) is not the only insurance company, which is doing life insurance business in Pakistan as the private sector players are also in the business for over a decade. However the major chunk of the market share i.e. 75 per cent is held by the State Life despite competition, said Shahid Aziz Siddiqi, Chairman State Life Insurance Corporation (SLIC) in an interview.

The chairman said with a great amount of confidence renewal of policies of the State Life policyholders is a matter of pride as around 85 percent policies are renewed by SLIC against the global average of 72-75 percent, which is a source of strength for our workforce comprised over 110,000 commission agents across the country.

In fact, health and education are our first priority, and hopefully within 2-3 year, this program will be expanded to the poor and middle-income groups. Actually, a lot of room and a huge market remains untapped in Pakistan as only 0.3 percent of the population has been insured in Pakistan while in Bangladesh five percent of the population has insurance cover and it is nine percent in India. The insurance industry has a lot of business, which needs focus and efforts with a view to improve the living standards of the people.

The outstanding number of commission agents means that State Life is providing job opportunities to over one lakh families in all corners of the country. Even our competitors in the private sector admit this noticeable edge enjoyed by the State life.

SLIC has successfully won the confidence of the people in life insurance, which is reflected in the quantum jump of policyholders within a span of three years from 24 lakh in 2008 to 37 lakh in 2011.

Shahid Aziz Siddiqi while highlighting the growing role of insurance industry in the socioeconomic development pointed out that with the increase in numbers of policyholders, the business volume also climbed from Rs4.5 billion in 2008 to Rs12 billion in 2011 indicating general awareness of the people regarding benefits of insurance cover.

The insurance cover in early age of a person provides tremendous financial support at the age of retirement beating effectively the adverse effects of the inflation. Generally speaking, people at middle and low income grounds are offered policies amounting to three or four lakh rupees at a young age of 25-30 years.

Such policies offer 12-13 percent bonus, which when matured bring a handsome amount to the tune of around One Crore to the policyholders, an effective way out of inflation for low income groups, he remarked.

Since SLIC is a government owned organization, our first priority is to facilitate people at grass root level and with the efforts and focus on smaller towns, the lion's share of business is generated more from rural population as compared to urban centers.


Sharing the size of life fund of the State Life, Shahid Aziz said with a sense of achievement, "our total fund resource today is estimated at Rs270 billion that attained a quantum jump from Rs170 billion just in three years. State Life Fund from abroad has increased from $38 million to $60 million in the same period of three years, as we are also doing business in Dubai, Abu Dhabi, Kuwait, Jeddah, Riyadh, and Sharjah.

When asked about productive utilization of huge life fund, the chairman with a broad grin on his face stated that the fund management is in the hands of professionals which are making best use of the funds by investing in profitable areas. However, being a government organization and the custodian of the people fund we are a little bit conservative and take decisions with a lot of prudence.

This professional expertise and prudence usually help building up profits of the corporation. He cited the example of investment trend, which resulted in a profit of about Rs3.5 billion this year. Since the government papers are always safe, most of the funds are invested in Pakistan Investment Bonds, and other strong papers besides investment in stocks, real estate etc. As an outcome of this investment, we earned a profit of Rs27 billion last year taking the Life Fund from Rs230 billion to Rs270 billion, he said with a sense of achievement.

He, however, made it clear that instead of describing it a profit it is more appropriate to call it as actuarial fund. Since this organization is owned by the government, we also give a handsome dividend to the government every year. Under this dividend head, State Life contributed Rs3.5 billion to the government.


In order to improve business volume, the State Life has planned to offer innovative products to attract more and more policyholders. In this respect, SLIC has entered into an agreement with United Bank to launch bancassurance business in collaboration with UBL. We are also considering collaborating with other banks and negotiating with National Bank, Standard Charter, and Bank Alfalah for initiating bank assurance business.

Besides, bancassurance, the State Life is also in the process to offer Shariah- compliant products of Takaful or Islamic Insurance business an option to the people who desire to get Islamic insurance. Although we are a conventional insurance business, we are not doing any thing un-Islamic and investing in stocks such as fertilizer, cement or oil and other such scrips which are not un-Islamic by nature

When his attention as drawn towards general impression that SLIC makes heavy investment in real state business, the chairman brushed aside the impression and said that State Life did not acquire any new building after 1996. As a matter of fact, the number of property was increased in 1972 in the wake of nationalization when a number of properties were purchased by the State Life.

Today the State Life has some 62 buildings in different cities of the country including 28 plots. The book value of these properties is estimated around Rs3.5 billion. However, the market value may be much higher which is likely to be around Rs30 billion or more. The value increased with the passage of time as the State Life has the holding power, and is not involved in property business.


About the contribution of insurance industry towards social developments and public welfare as a huge majority of the people live without any health cover, the chairman said under Benazir Income Support Program, the government has tasked State Life to provide health insurance to the people at the grass root level. Currently, we are engaged in capacity building to achieve that target and to begin with we have started a pilot project Faisalabad in which we intend to provide health cover to over 47,000 families with an estimated support of Rs25,000 per annum. With this experience, we would be expanding the concept of health insurance in rest of the country besides introducing new products to support poor and middle class families with health cover.