KARACHI: The Securities and Exchange Commission of Pakistan (SECP) has approved a range of new annuity products aimed at closing a longstanding gap in the country’s retirement framework, giving retirees structured options to convert accumulated savings into predictable income.
The SECP said the approved products include life-contingent annuities, deferred annuities, annuities with guaranteed payments and hybrid structures combining guaranteed and lifetime income benefits.
The move addresses what regulators described as a critical weakness in Pakistan’s retirement system, which has traditionally focused on savings accumulation during working years while offering limited mechanisms for post-retirement income distribution, a shortfall made more acute by rising life expectancy and persistent inflation.
“These products will help retirees convert their accumulated savings into a regular and predictable income stream after retirement, reducing financial uncertainty in later years,” the SECP said in a statement.
The products will be available through conventional life insurance companies as well as Window Takaful and full-fledged Takaful operators, extending access to both conventional and Shariah-compliant segments of the market. Additional insurers are expected to introduce comparable products in the coming months.
The approvals follow consultations with insurance sector stakeholders and align with the government’s broader policy shift from defined-benefit pension systems towards defined-contribution schemes, in which annuities serve as the primary vehicle for converting retirement savings into stable income.
