THE Insurance and Pension Commission (IPEC) will introduce a policy to govern insurance players in 2014.
By Tarisai Mandizha Business Reporter
IPEC acting commissioner Josphat Kakwere said the policy would compel insurance players to disclose their financial position to the public.
“IPEC is working on a policy which will be used as a disciplinary tool for the insurance sector to assist players to know what is expected of them,” Kakwere said.
He said IPEC has penalised some companies for late submission, but the commission was not in the business of raising money through fines. Penalties, he said were levied to deter players from engaging in undesirable practices.
“Yes, we have penalised other players for missing out on deadlines until we have come up with a deliberate policy decision to disclose such information for public consumption,” he said.
Kakwere said the penalty for late submission of any return for insurance companies was $200 while the fine for operating without licence could be a maximum of $5 000.
“Late submission of returns by any player may be a red flag of problems in a regulated entity, which may prompt investigation into the activities of the player. Depending on findings, appropriate action will be taken,” Kakwere said.
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According to the IPEC in the half quarter ended September 2013 report, the life industry recorded a 33% growth to $188million in net premiums.
Total costs grew by 47% to close at $141 million culminating in a $47 million technical profit as compared to $46 million in 2012. During the period under review, life companies wrote $183 million in net premiums as compared to $129million in 2012 which reflects a 33% and 86% annual and quarterly growth rates respectively.
According to the report, life industry wrote $186 million in gross premium terms constituted by 93% from recurring business and the balance of 7% was new business.
“Corporate employee benefit business contributed $132 million or 71% in gross premium whilst the balance was individual lines business.This trend may be attributable to the generally low disposable incomes more so on the part of individuals and the shift of the economy towards the informal sector,” said the report.
