Three short-term insurers have failed to meet the industry prescribed $1,5 million minimum capital requirement as gross premiums written (GPW) in the first quarter to March remained flat, mirroring the slowdown in economic growth, the regulator said on Thursday.
In 2013, the Insurance and Pension Commission (IPEC) doubled the minimum capital requirements for the sector, with short-term insurers required to achieve a minimum capital level of $1,5 million and life assurers having to put up $2 million by September last year.
IPEC commissioner Manette Mpofu declined to say which companies had failed to meet the capitalisation levels or the commission’s response to the failure. She, however, told The Source that GPW for the period under review declined to $70,9 million from $71,2 million in previous quarter, representing a 0,45 percent decrease.
She said during the period ending 31 March 2015, 1.38 percent of the assets were invested in prescribed assets.
Short-term insurance companies are required to reserve five percent of their funds for prescribed assets while life assurance companies and pension funds are required to put up 7.5 percent and 10 percent, respectively.
The regulator has, since dollarisation in 2009, deregistered several insurers which include Agricultural Insurance Company, Altfin, Jupiter Insurance Company, SFG Insurance Company and Suremed Health Insurance Company.