Insurance sector regulator begins Zim dollar compensation talks
PHILLIMON MHLANGA
THE Insurance and Pensions Commission (IPEC) has begun formal discussions with industry players and aggrieved policyholders who lost value of their investments with a view to find possible compensation modalities, Business Times can report.
Many Zimbabweans lost their investments totalling more than US$3bn during the process of conversion of balances from Zimbabwe dollar to the greenback which was commissioned four years ago. This resulted in huge pension investments suddenly turned into few cents or dollars.
“The Commission is engaging with insurance and pension’s industry players, apex bodies and aggrieved policyholders and pensioners on a sustainable way to compensate policy owners and fund members on value lost,” IPEC said.
In 2015, former president Robert Mugabe established a Commission of Inquiry to look into the conversion of values from Zimbabwe dollars to United States dollars for the period 1996 to 2014.
The inquiry was triggered by widespread public complaints by policyholders and pension scheme members between 2009 and 2011 who said they suffered huge loss of value during hyperinflation period and subsequent dollarisation of the economy.
This resulted in IPEC in 2012 engaging a private firm, Acumen Actuaries and Consultants, to undertake an investigation into the complaints brought forward by policyholders and pension scheme members.
But, the report was rejected after the industry challenged its findings and recommendations.
According to one of the former commissioners, Godfrey Kanyenze, amounts of “as low as US$0.08 were paid in lieu of education policies, endowment policies or retirement annuities” during the investigated period.
The Commission of Inquiry which was approved by both Cabinet and Parliament recommended that IPEC has to assume overall oversight over the implementation of the compensation framework by the industry, as well as obligating the institutions to submit their proposed compensation schemes.
In this regard, IPEC had already been mandated to look into compensation modalities.
