TWO insurance firms and a broker have been de-registered, the former for failing to meet the minimum capital requirement, and the latter for “unethical business practice”.The insurance firms -New Reinsurance Company of Harare (Pvt) Ltd and Global Insurance Company (Pvt) Ltd, and the broker – Navistar Insurance Brokers (Pvt) Ltd-were among five insurance firms that were placed under suspension between 2014 and last year.
The other two firms that were suspended – Excellence Insurance Company (Pvt) Ltd and KMFS insurance Company (Pvt) Ltd remain suspended.
The deregistration was announced by the commissioner of Insurance, Pension and Provident Funds Manet Mpofu in a notice that was published in last week’s Government Gazette.
“It is hereby notified, in terms of section 22 (1) (a) (v) as read with section 38 of the Insurance Act (Chapter 24:07), that the names of the two insurance companies and one broker specified in the Schedule have been cancelled off the register,” she said.
“New Reinsurance Company of Harare (Pvt) Ltd and Global Insurance Company (Pvt) Ltd’s licences have been cancelled after they failed to address their ‘unsound’ financial positions.”
According to the Insurance and Pension Commission (Ipec), short-term insurance companies are required to have a minimum capital requirement of $1,5 million.
On the other hand, Navistar’s operating licence was suspended in March 2014 when its three executives were slapped with charges of fraud and criminal abuse of office for allegedly defrauding Air Zimbabwe of $8 million in 2009 through inflating aviation insurance premiums.
Following its suspension, Navistar’s operations began to struggle and was subsequently placed under the judicial management of Wesley Sibanda of Welsa International Chartered Accountants, which it failed to exit before its eventual de-registration.
Ipec’s six months to June 30, 2015, the number of registered players, including insurance agents increased from 585 as at March 31, 2015 to 591 during the period under review.
With the latest de-registrations that figure has slightly dipped to 588 registered insurance firms currently in operation.