By Robert Tapfumaneyi

THE government has approved amendments to the Insurance Bill 2020, which seeks to repeal the Insurance Act and introduce best practices in Zimbabwe’s insurance sector.

This, according to the insurance sector, will play an important role in socio-economic development.

Information Minister Monica Mutsvangwa confirmed the development Tuesday during the post-Cabinet media brief.

“Through the proposed amendments, government intends to strengthen the institutional capacity of the Insurance and Pension Commission (IPC) and the regulatory framework to create a robust and internationally respected insurance and pension industry regulator,” she said.

“The Bill sets out the rules to be followed in merging insurance societies, in the transfer of insurance business to another registered insurer, and in the payment of premiums to the registered insurer whenever an insurance broker receives the premiums from policy holders.”

Mutsvangwa added: “Cabinet stressed that in order to guard against insolvency by insurance societies, every registered insurer will now be required to maintain a prescribed level of solvency.

“It will now be compulsory for insurance societies to submit financial statements within ninety days of each financial year.”

“The statements must be prepared in accordance with generally accepted accounting practices. All insurers will be required to submit to the Commission an actuarial valuation report which must be harmonized with the relevant audit report.”

The minister said insurers who wish to conduct electronic business must seek the approval of the IPC while the issuance of disability benefits in life policies will be done according to clearly spelt out conditions.

“An insurance fund shall not be executable by creditors who are not the policy owners. A registered insurer may not place assets outside Zimbabwe without Commission approval, including on percentages that may be prescribed,” she said.

In the event of currency change, Cabinet noted steps must be taken by the registered person, including the actuarial valuation of the insurance business in order to re-calculate the liabilities and assets in line with the new currency.

“This provision is expected to enhance the protection of policy holders.”