PRESS STATEMENT ON ULTIMATE INSURANCE 26.03.20

Pensions and Insurance Authority

Stand No; 4618 Lubwa Road, Private Bag 30X Ridgeway Lusaka, Zambia

Telephone: +260 211 251401105, Fax: +260 211 251492

E-mail: pia@102.23.123.62 ; Website: www.pia.org.zm

PRESS RELEASE

For Immediate Release

26 th March, 2020

THE PENSIONS AND INSURANCE AUTHORITY REFUTES ALLEGATIONS OF FRAUD IN CONNECTION WITH ULTIMATE INSURANCE COMPANY LIMITED

The Pensions and Insurance Authority (PIA) has noted with regret, adverse media reports against the Authority in relation to the arrest of officials of Ultimate Insurance Company Limited and allegations of fraud regarding the renewal of Ultimate Insurance’s 2020 license.

The Authority categorically denies any fraud or criminal conduct in the renewal of Ultimate Insurance Limited 2020 license. Like any other insurer licensed by the Authority, Ultimate Insurance Limited applied for the renewal of the 2020 license and upon consideration of the set requirements, the license was issued.

However, as the public is already aware, the Zambia Police Service is investigating the matter, including whether there has been any wrongdoing on the part of the Authority in the renewal of the 2020 license. The Authority welcomes the investigations and has been fully cooperating with the police.

Since becoming aware of the disputes between the shareholders of Ultimate Insurance Limited following my appointment in October 2019, the Authority’s focus has been twofold: (a) protecting the interests of policy holders; and

(b) attempting to resolve the issues in dispute to the extent possible, having regard to the fact that they are in court and therefore potentially contemptuous.

With regards to protection of policy holders, the Authority has been closely monitoring the company’s affairs. To this end, the Authority recently concluded an inspection of the company to assess its financial soundness, among other issues. The inspection revealed that although the company remains financially sound, there were some gaps in the governance structure. Directives have since been issued to the company to address these lapses. The Authority will continue to closely monitor the company.

As regards resolution of the disputes, the public may wish to note that, in an attempt to foster speedy resolution of the disputes through an out of court settlement, the Authority convened a meeting of the parties in November 2019, following which the parties vvere asked to propose terms under which they would agree to settle the matter. This effort nonetheless proved unsuccessful. It was then decided to deal with the question as to whether the properties that the two shareholders had transferred to the company as payment for shares were inflated, as alleged, as it does not seem to be one of the issues the courts are required to adjudicate upon.

Having concluded the investigation, the Authority, on Monday 23rd March 2020, invoked the provisions of section 40 (2) of the Insurance Act and demanded that a fresh valuation of the properties be undertaken by an independent valuer. Consequently, the two shareholders were invited to come and discuss the modalities of appointing a valuator. But as the public has come to know, the meeting never took place. Instead, officials from Marshlands Consortium, were arrested at the Authority’s premises.

The Authority is therefore desirous that the matters in court, especially the question of shareholding, could be expeditiously deposed off by the courts as it is the key to resolving the impasse in the company. In the meantime, as indicated, measures will be taken to ensure that policy holders are protected.

Finally, the Authority wishes to state that it will not be cowed by intimidation, harassment and humiliation into taking a decision outside the law.

The Authority appeals to the parties in this dispute, the media and members of the public, to allow the courts of law to conclusively deal with this matter,

Mapani Christopher

Registrar & Chief Executive Officer

Pensions and Insurance Authority