1 249 assessed compensation schemes not approved: Ipec

THE Insurance and Pensions Commission (Ipec) has stated that none of the 1 249 compensation schemes assessed under pre-2009 compensation regulations were approved due to non-compliance.

The delay is upsetting policyholders and pension fund members who suffered significant losses in 2009 when their pensions lost significant value.

The regulatory body said it received and assessed 1 249 complete submissions of the pre-2009 compensation schemes out of the expected 1 395 submissions.

Ipec said the actual payments which were initially scheduled to start this month will not be possible.

However, none of the assessed compensation schemes were approved due to non-compliance with the provisions of Statutory Instrument 162 of 2023 (compensation regulations), hence payments delays.

The planned compensation is in line with Statutory Instrument 162 of 2023 (Compensation for Loss of Pre-2009 Value of Pension Benefits Regulations) on September 29, 2023. The regulations were effective from October 1 last year.

The Government had committed to compensating pensioners and insurance policyholders for the loss of value during the change from the Zimbabwe dollar to a multi-currency system.

THE Insurance and Pension Commission (Ipec)

In the period between 2007 and 2009, Zimbabwe experienced its first major hyper-inflationary period, which eroded the value of most savings, including pensions.

A combination of poor regulatory enforcement and change in currency were largely blamed for value erosion by the Justice Smith Commission of Inquiry, which was appointed in 2015 to investigate the conversion process.

The commission concluded that most policyholders and pension scheme members were prejudiced during the conversion process and recommended that the affected policyholders and pension scheme members be compensated.

The commission recommended fair compensation of insurance policyholders and pensioners.

Ipec supported the recommendations of the Justice Smith Commission of Inquiry that called for policyholders and pension scheme members to receive compensation.

“The Insurance and Pensions Commission wishes to advise stakeholders that 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 were 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,” said Ipec in a statement.

Ipec noted, however, that some of the assessed 1 249 compensation schemes were close to fully complying with the compensation regulations and payments were expected to start upon approval of the schemes once they meet all the conditions.

“Ipec 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. Ipec will also issue public notices through various media to ensure that all targeted beneficiaries are informed of the compensation process and modalities.”

Government committed US$175 million to compensate pensioners and insurance policyholders for value that was lost during the changeover from the Zimbabwe dollar to the multi-currency system in 2009.

-chronice.c.zw