Insurance and Pension Commission (IPEC) says insurance benefits totalling $200 million remain unclaimed by subscribers.
The insurance regulator said the total number of pensioners with unclaimed benefits as at 30 September 2020 stood at 154,957 members.
In an interview with Robert Tapfumaneyi (RT), Cuthbert Munjoma (CM), IPEC Director Pension Supervision said they were rolling out various public awareness initiatives aimed at sensitising the public on the benefits.
RT: How many pensioners have unclaimed benefits and how much has not been collected to date?
CM: The total number of pensioners with unclaimed benefits as at 30 September 2020 stood at 154,957 members with the value of benefits amounting to about $200 million. It should be noted that the value is cumulative since 2009 and the Commission is enforcing the requirement for allocation of revaluation gains and investment return on the unclaimed benefits in line with requirements of the Guidance Paper on Currency Reforms issued in 2020.
RT: What could be the reasons behind the issue of people not claiming their benefits?
CM: This could be attributed to a many factor, which include: –
• an estimated 48% of members with unclaimed benefits date back to 2009 owing to disputed conversion values in the post dollarisation period. Closing the issue of compensation for the pre-2009 period would also address the issue of such unclaimed benefits;
• Migration of the labour force to the diaspora since the turn of the millennium and some non-resident pensioners have not been claiming their benefits;
• lack of awareness on the part of the pension scheme members and their beneficiaries that they are entitled to lodge a claim for such benefits when they fall due;
• Data integrity on the part of pension funds and administrators as some of the membership records are incomplete to enable tracking of beneficiaries of the unclaimed benefits; and
• Others could have relocated possibly to their rural homes and it is also possible that some members could have passed on. Where the member may have died, his or her beneficiaries such as family members have a right to claim the benefits.
RT: What are you doing to make sure that these members claim their benefits?
CM: Regulatory efforts to date are aimed at addressing the root causes for unclaimed benefits, which include those listed in our response to question 2. The measures being implemented include: –
• Enforcing the compensation framework recommended by the Justice Smith Inquiry to ensure revisiting of the disputed conversion values for the pre-2009 values;
• Implementing the requirement for allocating revaluation gains and investment returns to the unclaimed benefits;
• Rolling out various public awareness initiatives aimed at sensitising the public about the benefits, including coming up with SMS and website-Based search engines, where members can search for their names if there are benefits due to them. If one finds his or her name, they can then contact their respective pension fund or administrator to go through the due process of claiming their benefits;
• Encouraging pension funds to track their respective members with unclaimed benefits so that they can get paid their money. Some have been publicising these names in the media;
• Enhancing data integrity through improved Management Information Systems for pension funds and administrators and disclosure to fund members; and
• Enforcing requirement for remittance of unclaimed benefits to the Guardian Fund whilst efforts are underway to establish a statutory sector-specific fund to house all unclaimed benefits.
RT: What are you doing as the regulator to ensure that the trend does not continue?
CM: In addition to the regulatory measures highlighted in our response to question 3, we directed pension funds and administrators to regularly update the contact details of their members because one of the challenges why some of the members cannot be tracked now is because they changed contact details over time and their pension funds have tried to communicate with them but fail to reach them.
We are also encouraging pension funds to be proactive in empowering their members with knowledge on how to timely claim their benefits, through pre-retirement education programmes.