Namfisa mediation sees N$5.6 million paid to complainants……. long-term insurance industry biggest culprit

Chamwe Kaira

The Namibia Financial Institutions Supervisory Authority (Namfisa)’s intervention saw institutions under supervision paying back N$5.6 million to complainants as at 31 December 2022.

Namfisa said in the 2023 annual report that the total amount paid to complainants decreased significantly by 52.1 percent to N$5.6 million as at 31 December 2022, compared with 2021.

The N$5.6 million was paid out to 149 complainants with the highest amount, N$2.6 million, recovered from the long-term insurance industry, followed by N$1.5 million from the pension fund industry, N$1.2 million from the long-term insurance industry, N$270,041 from the micro lending and credit agreement industry, and N$40,806 from the medical aid funds industry.

Namfisa said the highest number of lodged complaints (220) were against the long-term insurance industry, followed by 172 complaints against the micro lending and credit agreement industry, 156 against the pension funds industry, 144 against the short-term insurance industry, 35 against the medical aid funds industry, and three against the capital markets industry.

The Authority said although the complaints lodged against the long term insurance industry, the micro lending and credit agreement industry, and the short-term insurance industry decreased compared with 2021, they remained among the top four industries in terms of complaints received during 2022. In this regard, these top fours industries together accounted for 94.7 percent, on aggregate, of all complaints lodged during the reporting period.

The Authority said it was able to resolve 93.4 percent of the 730 received complaints. This represents a decrease, compared with 94.9 percent for resolved complaints recorded in 2021. The remaining 6.6 percent was pending as at 31 December 2022 and therefore carried over to 2023.

Namfisa said the root causes for some of the complaints recurring include non-disclosure of pre-existing conditions at the underwriting stage, defaults resulting in higher repayable debt, signing agreements without reading and understanding them, terms and conditions not properly explained to Consumers, non-disclosure of how interest is charged, short-payments of instalments due to uncommunicated affordability limits at pay-points, a lack of proper affordability assessments conducted at the loan application stage; and a lack of communication regarding delays in the processing of claims.

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