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PIA Board Members |
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PIA and the Pensions Industry in Zambia |
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SIX-YEAR STRATEGIC PLAN 2005-2010 1.0 INTRODUCTION Pensions and Insurance Authority (PIA) was established in 1997. It derives its powers from the Pension Scheme Regulation Act No. 28 of 1996. It is the regulatory and supervisory authority for the Pensions and Insurance industries. The principal Acts that it administers are the Pension Scheme Regulation Act No. 28 of 1996 and the Insurance Act No. 27 of 1997. 2.0 MISSION STATEMENT Is to regulate the conduct of the Pensions and Insurance industries in order to protect the interests of pension scheme members and insurance policyholders and foster the industries growth, development and stability. 3.0 ACTION PLAN 3.1 Internal Systems Development Pensions and Insurance Authority intends to document and improve upon internal systems. These areas include; Ø On-site inspections Ø Registration/licensing procedures Ø Approving of insurance products Ø Handling of consumer complaints Ø Dealing with mergers, acquisitions and transfer of business Ø Winding up processes for pension schemes Ø Processes of approving of the appointments of principal officers Ø Handling of non-compliant entities 3.2 Development of the Legal Framework The legal framework comprises of the following areas, Ø The law establishing the regulator Ø The law prescribing the conduct of business Ø Supporting subordinate legislation (Statutory instruments) Ø Regulatory notices issued from time to time by the regulator The Insurance Core Principles Methodology issued by the International Association of Insurance Supervisors (IAIS) has useful data for the development of a suitable framework. The Financial Sector Development Assessment Programme (April 2002) and the Financial Sector Development Programme (FSDP) contain equally useful data for the exercise. The institution intends to, a) Convert the “office of the Registrar of Pensions and Insurance” into an autonomous body with sufficient powers and resources by amending the Pension Scheme Regulation Act and the Insurance Act by December 31, 2006. Further amendments are planned to, o Increase the level of compliance by introducing additional sanctions on defaulting entities by December 31, 2007 o By December 31, 2008, raise minimum capital requirements for insurers and formulate and implement measures designed to force sponsors of pension schemes to remit as soon as possible members contributions. o By December 31, 2008, formulate and implement measures that are designed to encourage healthy competition and eliminate unfair practices in the Pensions and Insurance industries. b) Harmonize the Pension Scheme Regulation Act and the Insurance Act with other pieces of legislation within and outside the country including the Southern African Development Community (SADC) and the Common Market for Eastern and Southern Africa (COMESA). c) Address provisions in the principal Acts that require the formulation of statutory instruments and supervisory guidelines. d) Prescribe standards for the conduct of Pensions and Insurance business. 3.3 Industry Development a) Pensions industry Pensions industry stakeholders include, · Pension schemes · Pension fund managers · Administrators · Custodians · Scheme members The industry is principally, regulated and supervised through the Pension Scheme Regulation Act No. 28 of 1996. However, it is also, influenced by other pieces of legislations key among which are, · The National Pension Scheme Act · The Land (Perpetual) Succession Act · The fourth schedule of the Income Tax Act No. 23 of 1968 · The Companies Act The institution intends to, · Document and improve on the registration procedures by June 30, 2007 · Document and improve on on-site inspections by June 30, 2007 · Streamline and document winding up processes for pension schemes. · Conduct seminars and workshops for trustees · Conduct consumer education b) Insurance industry Insurance industry stakeholders include, · Insurance companies · Re-insurance companies · Insurance brokers · Insurance Agents · Assessors · Loss adjusters · Policyholders The industry is principally, regulated and supervised through the Insurance Act No. 27 of 1997. However, it is also, influenced by other pieces of legislation among which are, · The Companies Act, · The Banking and Financial Services Act and · The Income Tax Act, Cap 323. The institution intends to, · Document and improve on licensing procedures by June 30, 2007 · Document on-site inspections by June 30, 2007 · Raise minimum capital requirements for insurers by 31st Dec 2008 · Separate the running and management of short-term and long term insurance businesses to enhance core competences by December 31, 2007. · Conduct seminars and workshops for directors and chief executives of market players · With the help of the Zambia Institute of Business College, introduce a certificate course for training insurance agents by December 31, 2006 · Conduct consumer education 3.4 Financial management Pensions and Insurance Authority is currently a grant-aided institution and fully dependant on Government for funding its operations. The institution intends to, a) Broaden the revenue base by developing alternative sources of revenue which will include among others, · Levying of the industry by amending the Pension Scheme Regulation Act. · Sustaining and if possible, increasing level of Government funding · Provision of consultancy services · Collection of penalties from defaulting firms and pension schemes through promulgation of a statutory instrument by December 31, 2007 · Charging for various services provided by December 31, 2008 b) Constantly monitor and review expenditure with a view of reducing it. c) Dismantling the debt stock. The institution intends to achieve this by, · Stopping the debt from growing by December 31, 2005 · Dismantling 10% of the stock by December 31, 2006 · Dismantling 25% of the stock by December 31, 2007 · Dismantling 50% of the stock by December 31, 2008 · Dismantling 80% of the stock by December 31, 2009 · Dismantling 100% of stock by December 31, 2010 3.5 Human resources and administration Staff salaries are low while the other benefits are equally unattractive. The institution intends to, a) Ensure retention of staff by, where possible, revising regularly the remuneration package in order to make it much more attractive and competitive b) Introduce performance appraisal system and prescribe appropriate awards by December 31, 2007 c) Constantly review the organization structure to ensure that it conforms with the changing requirements of the organization d) Encourage training and upgrading of knowledge by allowing staff to participate in seminars and workshops, and offering where possible financial assistance to those committed enough and willing to further their education e) Develop viable workplace HIV/AIDS policies to ensure increased awareness of HIV/AIDS at the institution by June 30, 2007 f) Acquire own office accommodation, when resources allow. g) Install a local area network in order to allow for ease of sharing limited resources and information by June 30, 2005 h) Widen the number of employees able to access the internet i) Create a webpage for the institution j) Acquire or develop a management information system by December 31, 2007 in order to · Enhance collection and storage of data from the industry · Examination and analyses of industry information · Generation of reports and industry statistics k) Establish an appropriate maintenance policy for the resources such as office equipment and motor vehicles in order to ensure efficient use of the resources. l) Establish suitable staff induction programmes by December 31, 2006
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