Insurance and pensions fund industry stakeholders are deliberating on the setting up of a commission of inquiry to investigate how policy holders were financially prejudiced by service providers when the country adopted the multicurrency regime in 2009.
BY OUR STAFF
This follows a meeting recently between Finance and Economic Development minister Patrick Chinamasa and Insurance and Pension Fund managers.
The meeting was aimed at establishing the extent of prejudice that pension fund members and insurance policy holders suffered due to the Zimbabwe dollar conversion and fairness of contracts.
Hundreds of thousands of pensioners in Zimbabwe are failing to sustain a reasonable standard of living owing to paltry pay-outs despite contributing money to the fund for many years.
Zimbabwe Pensions and Insurance Rights Trust general manager Martin Tarusenga said Chinamasa committed to meeting industry players soon to obtain input on how best to resolve the dispute between policy holders and service providers.
“We shall have a few more meetings on the way forward. We gave our input at the meeting last week. The main issue remains on how policy values were calculated. Were they fair or correct?” he asked.
“A substantial number of pensioners and insurance policy holders are not happy with the values of policies,” said Tarusenga, adding that the minister provided stakeholders at the meeting with government’s proposed terms of reference.
Chinamasa said the industry should provide input on the terms of reference, adding that it was government’s intention to finalise the conversion process and recommend what would be considered fair by all players and stakeholders in the pensions and insurance industry.
There is widespread dissatisfaction in the market with regard to the values originating from the conversion process, absence of consistency in values between various industry players, and substantial discrepancies in the value of policyholders who were contributing at similar levels.
The meeting also discussed the criteria for choosing such commissioners — a key requirement in coming up with an objective commission of enquiry — according to stakeholders.
The terms of reference point out aspects such as investigating the financial soundness of the Zimbabwe insurance and pensions industry before, during and after conversion from Zimbabwe dollars to US dollars, identifying all the causes of financial unsoundness, if any, and establishing how Zimbabwe could restore the financial soundness of the insurance and pensions industry.
The terms investigate all instances of failure of regulation, governance, legislation and oversight in the running of insurance and pension funds, regulation and monitoring of the pensions industry and make recommendations on how to deal with the issues.
The finance ministry is also expected to identify personnel for recommendation to President Robert Mugabe for the appointments to be made.