The Commission Inquiry into the Conversion of Insurance and Pension Values from the Zimbabwe Dollar to the United States Dollar appointed by former president Robert Mugabe in August 2015 has recommended that insurance policy-holders and pensioners should be compensated for loss of value suffered as a result of hyper-inflation in 2007-8 and the country’s adoption of a multi-currency system in 2009.
The commission’s investigation covered the period 1996 to 2014 and recommended that funeral policy holders should be compensated for alteration of benefits or cancellation of policies following dollarisation. Part of the recommendations read:
Notwithstanding the unsound practices in the industry, the commission is of the view that a fair and just compensation framework can be implemented to compensate for the loss of value suffered by policy-holders and pension fund members over the investigation period. In the recommended compensation framework, the commission assessed the asset and capital structure of the industry in evaluating its capacity to compensate for loss of value. The commission was satisfied that the industry has reasonable capacity to make good and compensate policy-holders and pension fund members for loss of value.
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The commission stresses the very high expectations from members of the public on the findings of the commission with regard to compensation. The loss of value has impoverished policy-holders and pensioners and there is an expectation that the findings of the commission will remedy this. Government is, therefore, urged to implement the recommended compensation framework as a matter of urgency, in order to alleviate the plight of impoverished policyholders and pensioners.
The commission also recommended that National Social Security Authority (NSSA) and other corporates should stop paying a flat pension benefit to retired contributors regardless of their salary level or years of participation in the fund. It also called on NSSA to abolish the five-year limit for claiming benefits.
The National Social Security Authority is Zimbabwe's social security company which was established in 1989 in terms of the NSSA Act of 1989, Chapter 17: 04, an act of parliament. The firm administers social security public funds on behalf of about 1,3 million contributors. NSSA... Read More About National Social Security Authority