eBusiness Weekly
HARARE – Pensioners and insurance holders who lost their benefits during conversion from the defunct Zimbabwean dollar to the United States dollar in 2009 by insurance companies are guaranteed compensation as the commission of inquiry set up to investigate the matter completed its mission and recently tabled its report to President Emmerson Mnangagwa, a senior official has said.
The commission, set up by former President Robert Mugabe in August 2015 to investigate the matter, was chaired by Retired Justice George Smith.
While its findings are yet to be made public, the commission, among other objectives sought to establish whether pensioners and insurance holders were prejudiced at the conversion of their policies when the country adopted multiple foreign currencies in 2009.
After the country dumped the hyper-inflation ravaged local currency, pensioners felt they had been grossly short-changed when they got next to nothing of their hard earned life savings in compensation.
Insurance holders felt insurers gained more from the conversion as some had allegedly bought fixed assets whose value continued to appreciate while they got meagre returns.
As part of its mission, the commission of inquiry held public hearings in the country’s 10 provinces to get opinions and input into the investigation. It sought to “establish losses of value, if any, associated with the conversion process.”
Insurance and Pensions Commission of Zimbabwe chairperson, Tendai Karonga said a voluminous report containing the findings and recommendations had been presented to the President after completion of the investigations.
“There will be some compensation but subject to making sure the insurance industry survives,” he told reporters at an insurance mentorship program being run in conjunction with financial services firm, ZimSelector.com. There will be some balances, some compromises.”
Karonga said the report was still under consideration, with the government set to make its position public in due course. Besides finding out whether pensioners were prejudiced, the commission of inquiry’s terms of reference also included establishing the total value of pensions as at December 2006 and March 31, 2009, the nature and type of assets pension funds acquired during the same period.
It also looked at the processes and methods used to convert pension and insurance values from local to foreign currency as well as establish the financial soundness of the insurance and pensions sector between December 2006 and March 2009.
Industry experts say the wiping away of pensioners life savings during the hyper inflationary period has had a serious impact and contributes to the negative perception that the younger generation has of the insurance industry, pensions and savings in general. – New Ziana
