Pensions compensation set for March 2024 delayed further
Staff Writer
The Insurance and Pensions Commission (Ipec) says actual payments under the pre-2009 compensation schemes, which were initially scheduled to commence in March 2024, will not be possible as the assessed compensation schemes are not compliant.
Ipec, in a notice to the public, said it received and assessed 1,249 complete submissions of the pre-2009 compensation schemes out of the expected 1,395 submissions.
The outstanding 146 schemes had either incomplete submissions or no submissions at all. Appropriate regulatory sanctions are being implemented in line with Statutory Instrument 162 of 2023.
“None of the 1,249 assessed compensation schemes were approved due to non-compliance with the provisions of Statutory Instrument 162 of 2023 (compensation regulations).
“As a result, the actual payments, which were initially scheduled to commence in March 2024, will not be possible,” Ipec said.
However, the regulator notes that some of the assessed 1,249 compensation schemes are close to fully complying with the compensation regulations, and payments are expected to start upon approval of the schemes once they meet all the conditions.
In that regard, IPEC said it is actively engaged with each pension fund and pension fund administrator to enforce compliance within the confines of the law.
“Once a compensation scheme is approved, the pension fund will directly communicate with eligible members regarding the payment modalities,” reads the statement.
IPEC said it will also issue public notices through various media to ensure that all targeted beneficiaries are informed of the compensation process and modalities.
Recently, Ipec flagged insufficient disclosures in the actuarial reports submitted as part of the 2009 compensation schemes.
It was noted that the inadequate disclosures are inhibiting the Commission from making an informed decision on the compensation schemes.
In October 2023, Statutory Instrument 162 of 2023 (“SI162,2023”) was published, and this focused on pensions and provident funds’ compensation for the loss of the pre-2009 value of pension benefits.
The implementation of this Statutory Instrument proposed that Actuaries, who are mostly members of the Actuarial Society of Zimbabwe, assist in its implementation.
Under the ASZ guidelines, the Actuary is expected to prepare a comprehensive report on the results of the compensation framework for the Trustees and other key stakeholders to have a full appreciation of the process.
In 2015, the government constituted a Commission of Inquiry to investigate the causes and extent of the loss of value of life insurance policies and pensions suffered by policyholders and pension scheme members following the conversion of Zimbabwe dollar policies to the multicurrency regime.
The Justice George Smith-led Commission of Inquiry found that some policyholders and pension scheme members were prejudiced during the conversion process and recommended that the affected policyholders and pension scheme members should be compensated.
The 2009 loss of value has contributed significantly to the low confidence that the industry is currently grappling with.
