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Finance Minister Mr Tendai Biti yesterday said he had written to the Insurance and Pensions Commission, the insurance regulatory body, demanding an explanation concerning complaints about paltry benefits.
“A lot of people lost their contributions and ultimately their savings to the pensions and insurance companies.
“IPEC has got to respond to allegations that are being levelled against it,” Mr Biti said.
He said contributions for pension and insurance were binding contracts that had to be honoured.
“The companies say that the contributions were wiped out by inflation, but they’re not considering the true value of contributions and assets before the hyper-inflation period.”
Minister Biti said he was one of the affected contributors and had a policy since 1994 with an insurance company with a sum assured of Z$50 million, and to date, he has never received a cent.
The general manager of Zimbabwe Pensions and Insurance Rights Mr Martin Tarusenga yesterday said they had sought the minister’s intervention in the impasse as their appeals to IPEC had been ignored.
Mr Tarusenga said IPEC, as the regulator of the industry, had been expected to urgently execute its key regulatory role to protect consumers of pensions and insurance services.
“The problem is that insurance companies are not accepting claims by our members, while others are offering to pay in the defunct Zimbabwe dollar, which is unacceptable.”
He said there were loopholes in Acts that govern the pension industry, which prejudiced clients and need urgent redress.
“We’ve since advocated the setting up of a new IPEC board to address some of these pressing issues,” said Mr Tarusenga.
“We have problems with the current board as it has many insurance executives, hence there is a conflict of interest in the addressing of our grievances.”
He reiterated the need for an astute body and administration of pension funds in order to safeguard workers from exploitation.
Mr Tarusenga said pension funds and insurance companies should be accountable and liable to pay up rightful pensions and benefits assured.
“The fact is, it is a contract between workers and the companies, where the latter pledges to look after their monies diligently,” Mr Tarusenga said.
“It is not only mischievous, but criminal for the companies to renege from paying benefits with a corresponding value to the contributions made.”
Since dollarisation in 2009, some pensioners, who have worked for up to 50 years and insurance policyholders, have been receiving paltry sums as little as US$20 per month.
Online Reporter