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Why is there no Automobile Insurance in Pakistan?

you title suggest very surprise, so firstly we have to get people insured, give value to the life then second is of the automobiles.

first give value to human life then think about the automobiles
 
There are 10's of car insurance if not 100s . search before speak

Here are some names I found for auto insurance in Pak

@AZADPAKISTAN2009

Askari General Insurance Rawalpindi +92 51 9272425-7
EFU General Pakistan Karachi + 9221 3231 3471 to 90
Habib Insurance Company Karachi +92 (21) 111-03-03-03
New Jubilee Insurance Karachi (021 ) 35205094

  • becuase its unislamic (insurance is not allowed in islam)
  • Because repair , parts and labor is cheaper, then whats the point ?




If I am not wrong auto insurance is also mandatory in Pakistan and is available even in 100 rupees (just for showing to traffic police but you can't actually get claim against it). But the problem is no body takes law seriously in Pakistan so no body go for auto insurance and infact this is very small problem if you compares absence of auto insurance with absence of driving license. Off topic But a Sad Reality.

In Pakistan, health insurance is also very low, auto insurance comes later. Another sad reality

you title suggest very surprise, so firstly we have to get people insured, give value to the life then second is of the automobiles.

first give value to human life then think about the automobiles

rightly said buddy
 
Bro...i've worked in a commodity exchange lol
Well I am not denying you working in commodity exchange. I talked about the modus operandi of Futures not being consistent with laws of Islamic business. The points like fair distribution of wealth etc come under the social and economic justice not business laws as per say. For example, Salm is a type of forward trade (a leg in spot and a leg in forward) which is allowed in Islam.

If I am not wrong auto insurance is also mandatory in Pakistan and is available even in 100 rupees (just for showing to traffic police but you can't actually get claim against it). But the problem is no body takes law seriously in Pakistan so no body go for auto insurance and infact this is very small problem if you compares absence of auto insurance with absence of driving license. Off topic But a Sad Reality.

In Pakistan, health insurance is also very low, auto insurance comes later. Another sad reality



rightly said buddy
Yes mandatory, but neither the traffic police, nor others bother about it. Not carrying an insurance card can lead to a challan.
 
I don't understand what you are trying to say "no auto Insurance"? Pakistanis don't have culture of auto insurance generally but it doesn't mean auto insurance is not available.

Still majority of new vehicles are insured.

It is mandatory in many countries I have been to. In Spite of that many drive without the insurance in developed countries.

Key to any law is enforcement. If there is no enforcement then why would anyone get it on their own accord. At least you should make it mandatory to get liability insurance which covers others but not your own in case of an accident.

Also the new vehicles you buy on loan from banks will have to be insured for the term of the loan. My bank asks for insurance renewal papers every year from me. There are many ways you can ensure that people are being responsible drivers.

  • becuase its unislamic (insurance is not allowed in islam)
  • Because repair , parts and labor is cheaper, then whats the point ?

Will the government step in if you damage some ones car or property and compensate for your negligence? What if you injure someone seriously and they end up disable?? Who will take the responsibility?
 
I think in India floods etc are covered.

You can get insurance for acts of god like floods, lightning and tree falls etc. It is not written down but I had discussion with my insurance agent and he said they are covered under comprehensive insurance packages. So, it is better you talk these things with your agent.
 
In India the number of people who are insured is low compared to developed countries. In developed countries like US has 85% people covered for health but our figures are at 5% penetration. We had a late start when we opened up for private insurance in 2000 and our growth is 10 folds since then.

According to latest IRDA figures, India has about 57 crore of insurable people. Out of which Private Life Insurance companies have 4.03 crore Policies in force which cover about 4.20 crore lives [upto 31st March 2010].

Here are some of the highlights released by IRDA:

  • The insurance penetration has increased from 2.32% to 5.51% over the period 2000 to 2010.
  • The number of insurance offices has increased from 2,199 in 2000 to 12,018 in 2010.
  • From the single channel system of tied agents which was predominant before opening up of the sector in 2000, multiple channels of distribution comprising brokers, bank assurance, corporate agents emerged accounting for nearly 21 percent of all new business in the year 2009-10.
  • The first year life insurance premium grew from Rs.19,857.28 crore in 2001-02 to Rs.1,09,894.02 crore in 2009-10.
http://trak.in/tags/business/2011/11/30/insurance-growth-indians-numbers-statistics/
 
There is insurance in Pakistan but its mandatory rathar its optinal
 
Yet another ignorant thread! Pakistan has now auto insureres running for decades.
I been using it.Name some of them 1-Adamjee 2-Alfalah 3-United Insurers 4-AGI 5-New Juiblee insurance and many small players like Habib,CSIL etc.


http://www.jamiabinoria.net/efatawa/03-21-2009/6069.htm
https://www.flickr.com/photos/dawateislami/8667693064/in/photostream


Yes insurance of all types are considered as undesirable in Islamic law. Takaful,however is allowed because in Takaful the holders share both risk and reward the primary Islamic principal of business.


hmmm... but i think car insurance is diffrent than life insurance which is prohibitted correct me if am wrong

it is nothing more than a big joke.

There are many big insurance companies in Pakistan offering lucrative packages for automobiles.
Even my own car was insured before and when it got stolen than I received money from the insurance provider.
@AZADPAKISTAN2009 You really need to search before posting fellow


i was toking about mandatory thing i didn knew u can drive a vehicle freely in pak without insurence
 
Insurance is compulsory in India otherwise have to pay fine ..
 
I was just wondering

How come there is no Auto Insurance ? In Pakistan

In Western Society , the Auto Insurance does few positive things in Economy

a) It creates Jobs in Insurance sector , Insurance advisors , customer support , claim agents etc

b) It gives protection to people in time of serious accidents , helps replace or repair your car. Helps protect you
if you kills someone in accident and you get sued in court

c) It forces people to drive safely or their Insurance rate will go up , if it is too high then you can't drive your driver license is cancelled. Car is confiscated

d) Expensive cars like BMW etc have higher rates of insurance

e) Car insurance also covers for Theft incidents


Motor Bikes have the "MOST EXPENSIVE insurance premiums due to dangers to society and danger of lethal accidents



> Police force , can better control illegal cars by checking Insurance coverage

In return may be the Insurance sector can contribute a premium into Police Force , by means of Direct funding to police department based on number of insured cars on road. Extra funding to increase police salaries


Insurance also forces , smaller numbers of cars on road


This sector could easily create Million Jobs in Pakistan


People who are caught with no insurance get their licence revoked , cars sent to recycle
auto-recycling.jpg


It is funny becasue car insurance help identify terrorist as well, most of time the Terrorist will not have any insurance paper


Typically if there is a criminal Warrent for a person , the info is channelled from police system to the insurance company so whenever the person is stoppped at road by police and they check his profile they will know he /she is a criminal wanted


Most police officers in Western Society ask 2 things (Ownership paper + Insurance)

Becasue of the fear of hig premium (monthly payments for insurance) if they get into acccident people all drive very carefully and it all contributes to a safe road experience


Some possible Job titles


> Insurance Broker
> Insurance Manager
> Under Writing agent
> Customer Service Representative (Call Center)
> Territory Managers

Indirect Jobs:
> Mechanical work done on car repairs done with Insurance company's approval
> Appraiser who judges the damage in accident prepares estimates
> Tow Truck
> Painters who paint the cars after accident brand new
> Auctioneers who buy write off cars and sell parts of it after purchase
> Car parts company in Pakistan sells new parts for repairs less chance of dented car running around city

>Lawyers pressing claims against insurance companies for negotiation of claim

Wellness Jobs:
> Nurse and Attendant care after accident paid by insurance company
> Physio therapy consultant

Private care in hospital:
>Paid for by insurance for legitimate accidents

> Fines for insurance violators (Revenue for Police department)
> Fines for people who have insurance but can't produce copy for officer

> Lawyers who work with claims against bodily harm (if you hit a person etc break their arm or kill somoene)


> Storage facilities where violator's cars are kept for demolishing or sale for unclaimed cars after certain days



Plus: Insurance dictates you install steering wheel blockers, GPS hidden locator etc so new gadgets are always being sold to consumer



Note: Added this line later when people pointed on some places who offer auto insurance , however may be 0.05% of people would have auto insurance as it is not mandatory like it is
all over the world. i.e if you have a car you need to have insurance. The fact even I did not knew about existence shows how little developed area this is

It is mandatory.

KARACHI:
In spite of frequent cases of vehicle theft and snatching in the country, most of the car buyers seem uninterested in getting their vehicles insured – a mandatory condition for the owners aimed at protecting them from heavy losses in case anything untoward happens.

According to a survey conducted by Pakwheels.com and YouGov, an overwhelming majority of cars (78%) running on roads are not insured. Only 1,070 (22%) say their cars are insured.

Enumerating the reasons, Atif Zafar, auto sector analyst at JS Global Capital, said a major factor behind the small number of insured cars could be low penetration of insurance companies and lack of access to smaller and remote towns. In addition to these, he said, a large number of Pakistanis considering conventional insurance as un-Islamic and lack of customer knowledge were also among the top reasons.

“While the survey shows car insurance trend going in the right direction, the 22% insurance level is a little bit uncomfortable,” he said. “I think this should be around 40% to 50%.”

The country’s private insurance industry is too small with total premium-to-gross domestic product ratio standing at just 0.3%.

According to the Insurance Association of Pakistan, it has 38 member companies with a premium of Rs 66 billion until 2011. Of these, 32 are non-life insurance companies with premium of Rs43 billion and six are life insurance companies with premium of Rs 23 billion.

Among the 1,070 who have insured their vehicles according to the survey, 32% say they have either taken insurance cover from Adamjee or EFU Insurance having 17% and 15% share respectively.

Most of these chose Adamjee and EFU on the recommendation of friends and family members, who had experienced the services of these companies.

The remaining 68% say they have chosen one of the following companies – Askari General Insurance (8% share), Takaful – Islamic insurance ( I thought it was un-islamic :rofl:) (7%), IGI (6%), New Jubilee Insurance (5%) and TPL Insurance (4%). Among these, a whopping 37% either do not remember or did not provide their insurance company’s name.

Talking to The Express Tribune, an officer of EFU General Insurance claimed that the company enjoyed a share of over 50% in the auto insurance market.

“People are increasingly realising the importance of car insurance. Though it is difficult to give exact percentage growth in auto insurance annually, one can safely say car insurance is getting popular,” he added.

He pointed out that most of the new car buyers get insurance at the time of purchase, adding many purchasers of used imported cars were also taking insurance cover.

Insurance companies describe those who buy new vehicles from a company dealer as ‘informed customers’. To target them, the companies collaborate with car manufacturers and succeed in bringing most of the car buyers under insurance cover.

Annual premium

Insurance companies collect annual premium from car owners at the rate of 3% to 5% of the current value of the vehicle. However, contract details may vary from company to company.

For instance, if a car is worth Rs1.5 million, at a premium of 4%, the owner needs to pay Rs60,000 annually to the insurance company.

High risk

High risk of theft, snatching and damage to new vehicles in big cities has also prompted car owners to go for tracking services. To take advantage of this, many leading insurance companies offer such services along with insurance with some additional charges.

An officer of Adamjee Insurance told The Express Tribune more people were realising the fact that a car without insurance was a big risk, especially in cities like Karachi where risk factor was one of the highest in the country.

Industry officials say one of the biggest risks to new cars in Karachi is theft, especially when a car crosses the city’s limits and enters smaller cities of Sindh and Balochistan.

However, this proves a blessing in disguise for the car insurers in big cities as more people tend to take insurance cover to protect their vehicles.

In coming months, two factors are expected to aid car insurers. One – the domestic auto industry is about to regain historical production figures of over 180,000 units per annum after a long wait of five years. Two – the import of used Japanese cars has surged as the country imported over 55,000 cars last year.

Published in The Express Tribune, September 10th, 2012.
 
i was toking about mandatory thing i didn knew u can drive a vehicle freely in pak without insurence

Bank loaned cars are must to be insured.

Cars which you purchase through your pocket aren't mandatory to insure, its up to you whether you want to insure it or not.
 
Well I am not denying you working in commodity exchange. I talked about the modus operandi of Futures not being consistent with laws of Islamic business. The points like fair distribution of wealth etc come under the social and economic justice not business laws as per say. For example, Salm is a type of forward trade (a leg in spot and a leg in forward) which is allowed in Islam.

Yes. But a futures exchange DOESN'T deal with forwards. Futures trading is a derivative - it doesn't have any real asset backing as it deals with exchange of contracts, rather than the underlying asset (99% of all futures contracts are cash settled - not asset backed). In addition all futures contracts are based off ribawi goods - i'll let you research on that.


Fair dist of wealth does come under economic dealings, yes - it is an overarching rule.
 
Yes. But a futures exchange DOESN'T deal with forwards. Futures trading is a derivative - it doesn't have any real asset backing as it deals with exchange of contracts, rather than the underlying asset (99% of all futures contracts are cash settled - not asset backed). In addition all futures contracts are based off ribawi goods - i'll let you research on that.


Fair dist of wealth does come under economic dealings, yes - it is an overarching rule.
A-Future is a derivative not trading futures is called a derivative.
B-Futures can be deliverable i.e. Exchange of underling takes place at maturity or cash settled I.e. difference in the future price and spot price is paid up (daily settled in case of future I.e. M2M) but it doesn't mean future doesn't have any underlying. If it doesn't as u put it, it doesn't qualify to be called a derivative (a security which drives it value from underlying). It's due to the same cash settlement it's not permitted I.e. money exchanged for money at inequality a variant of ribba.
 
3rd party insurance is mandatory in many countries... not in Pakistan. It's not about gdp etc, because even poor countries have mandatory 3rd party insurance, it's because of religious reasons.

Insurance is haraam in Islam:

https://islamqa.info/en/8889

So govt cannot enforce it. But even if it weren't, govt STILL can't enforce it, govt can't even enforce numberplate and license laws! Anybody can just make up a number plate!

But anyhoo, since 3rd party insurance is not mandatory, nobody has to visit a car insurance company, so they have very limited options to sell 1st party insurance.

The insurance sector depends on mostly on mandatory insurance on car leases, and insured cars by MNCs etc.
 
Auto insurance is not that profitable, compared to other insurances.... to make things worse - the auto dealers, they rely on income from insurance to a great extent, and they do lot of malpractices


In India auto insurance is mandatory...sometimes I really feel the law is just to promote the insurance sector and create job rather than a genuine intention to help auto owners....
 

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