- Eleven out of twelve life assurers failed to comply with prescribed asset ratios
- All reassurance players prescribed ratios were below 15% threshold
- Total investments in prescribed assets amounted to ZWL$1.95 million
Harare- Life assurers continue to fail to meet the minimum required threshold for prescribed asset ratios under both the life assurance and life reassurance businesses, a recent report by the Insurance and Pensions Commission (IPEC) shows.
According to the report, performance for the half-year ended 30 June 2020 shows that eleven out of the twelve life assurance players reported prescribed asset ratios that were below the minimum threshold.
Total investments in prescribed assets by the sector amounted to ZWL$4.6 billion from ZWL$2.1 billion in the previous quarter which translates to a sector prescribed ratio of 9.24% from a compliance level of 9.90% as at March 31 2020.
In the reassurance sector, all four players also reported prescribed ratios that were below the minimum required threshold of 15% in the period under review.
Total investments in prescribed assets by the life reassurance sector amounted to ZWL$1.95 million translating to a sector average prescribed asset ratio of 0.24%.
In the prior quarter, the sector reported an average prescribed asset ratio of 1.16%, showing a decrease of 7.38% from 8.54% reported as at 31 March 2020.
The minimum prescribed asset thresholds currently stand at 10% for both short-term non-life insurers and reinsurers and 15% for life assurers according to Statutory Instrument (S.I) 206 of 2019 and as reports by IPEC indicate, entities are failing to comply.
Investments in prescribed assets help Government in funding infrastructure developments and other projects of national interest.
Equity Axis News