Sundaymail Editor
Online Reporter
The Insurance and Pensions Commission (IPEC) has released a framework that will guide players in the sector in introducing income drawdown products.
The framework took effect on October 1, 2021.
Income drawdown products provide a flexible option for pensioners to access their savings. These products work by allowing a pensioner to leave their pension invested, while being able to drawdown some of it as taxable income.
Said IPEC Commissioner Dr Grace Muradzikwa in a circular dated October 1, 2021 to insurance companies and pension funds:
“The framework provides guidance and key principles to be adhered to in the development and marketing of income drawdown products in the insurance and pensions industry, with a view to expand retirement options as well as protect members of pension funds and their beneficiaries.”
In the past few decades, the local economy has experienced episodes of inflation cycles and policy changes, some of which significantly eroded long-term savings including insurance policies and pension savings.
Income drawdown products are expected to help restore the public’s confidence in the sector, which is fundamentally underpinned by the concept of long-term saving.
Online Reporter