Gvmnt demands finality to pension values conversion issue

Gvmnt demands finality to pension values conversion issue

HARARE, Government has challenged insurance regulator, Ipec and pensions industry players to bring finality on question of transparency regarding the conversion of values from the ZW$ to the US$.

Finance and Economic Development, Secretary George Guvamatanga, in a speech read on his behalf at an inaugural Ipec Insurance and Pensions media awards said lack of finality over the issue was impacting confidence levels towards the sector.

“Following the recommendations of the Presidential Commission Inquiry into the Conversion of Insurance and Pensions Values from the Zimbabwe dollar to the United States Dollar, which has since been adopted by Government, we call upon the media to help us restore confidence in the sector.

“More importantly, I call upon IPEC and insurance and pensions industry players to bring finality on question of transparency regarding the conversion of values from the ZW$ to the US$,” he said.

He noted that the level of confidence in the insurance and pensions industry is low at the moment owing to the low values that policyholders and pensioners got after adoption of the multicurrency system in 2009.

Guvamatanga said when the insurance and pensions industry sneezes; the whole economy catches a cough given the sector’s economic contribution.

“The sector plays a key role in the attainment of SDGs pertaining to economic contribution, mainly through long-term savings mobilisation for investment and consumption that can spur growth, supporting innovation, and infrastructure financing, as well as promoting economic growth and jobs.

“It is therefore Government’s desire for the insurance and pensions industry to refocus its developmental role given that it is traditionally the largest source of domestic financing the world over,” said Guvamatanga.

Through the recently availed Transitional Stabilisation Programme, a successor economic blue print to ZimAsset, government has set a number of deliverables for the sector.

These are the regulation and supervision of medical aid schemes and legal aid societies by Ipec, broadening insurance support to agriculture through facilitating development of insurance products that target agriculture.

Other deliverables include increasing insurance penetration ratio from the current 4% to 20% by year 2020 and a review of some of the stringent insurance industry licensing requirements, including for brokers and underwriters.

Meanwhile, government is concerned with non-compliance with prescribed asset requirements by some pension funds and insurance companies, particularly funeral assurers.

“I urge non-complying institutions to support our economic turn-around efforts by supporting bankable projects of national importance, of which there are many such bankable projects. There is no justification for not participating,” the Secretary said.