The National Assembly Standing Committee on Privatization has directed the finance ministry to devise a plan to return Rs48 billion to Pakistan Postal Life Insurance, as the company struggles to meet its expenditures. The directive was issued during a committee meeting held on Friday under the chairmanship of Dr. Farooq Sattar.
Finance ministry officials informed the panel that the government had allocated Rs14 billion for the insurance firm over the last four financial years, but only half of this amount had been utilized. Officials from Postal Life Insurance explained that the company was established in 2021 on an emergency basis to help Pakistan be removed from the Financial Action Task Force (FATF)’s grey list.
The company currently holds Rs48 billion in funds, which are being held by the finance ministry. However, the ministry is neither returning the amount nor paying interest on it, according to the company officials. As a result, Postal Life Insurance has been unable to pay insurance claims to its clients in a timely manner due to the paucity of funds.
Key Issues Faced by Postal Life Insurance
- Rs48 billion in funds held by the finance ministry
- No interest being paid on the held amount
- Inability to pay insurance claims on time due to lack of funds
- Only half of the allocated Rs14 billion utilized over four financial years
The committee’s directive aims to address the financial challenges faced by Postal Life Insurance, enabling it to fulfill its obligations to its clients. The situation highlights the need for effective financial management and coordination between government entities and state-owned enterprises.
