KARACHI, Jan 9: Jupiter Insurance Company Limited said that it had been permitted by the Securities and Exchange Commission of Pakistan (SECP) to underwrite business.

The company produced copy of a letter issued by the SECP, Insurance Division dated January 8, 2003, stating: “Since the reasons for direction to cease entering into new contracts of insurance have ceased to exist, the direction given vide letter No.ID/LO. 28/6/02 dated 1st January, 2003, is hereby revoked/withdrawn under sub-section (5) of section of Section 63 of the Insurance Ordinance, 2000, with immediate effect”. SECP had last week asked 12 companies to cease underwriting insurance business due to inadequacy of their paid-up capital, which had to be raised to a minimum of Rs 50 million by end- December 2002.

Mahmood Hasan, chief executive Jupiter Insurance Company told Dawn that the company had fulfilled its paid-up capital requirement of Rs50 million before December 31, 2002, but “due to some anomaly in fulfilling the procedural requirements of the Company Registration Office, the company’s name came up with the 12 who were asked to stop writing new business”.

Late last week, another insurance firm—the Union Insurance Company of Pakistan Limited—had also said that it had been able to raise its paid-up capital to Rs54.57 million before the last date stipulated by the SECP, i.e December 31, 2002.

Although the list of 12 insurance companies that were asked not to do business beyond January 1, 2003 had been issued by the SECP, the Commission has yet to come up with the amended list that might reinstate those that had fulfilled the capital adequacy requirement. The delay is understandably causing hardship to some of the insurance companies who believe that they had actually come up to the expectations and are anxious that their names be cleared.

Shares in Union Insurance are quoted on the stock exchanges, while Jupiter Insurance is an unlisted public limited company that started business in October 1994.