Insurance and Actuarial Science

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An Analysis of Factors Affecting the Performance of Insurance Companies in Zimbabwe
(2017) Mazviona, B. W.; Dube, M; Sakahuhwa, T.
The study sought to examine factors affecting the performance of insurance companies in Zimbabwe. We utilized secondary data from twenty short-term insurance companies. The data was for the period from 2010 to 2014. We used factor analysis and multiple linear regression models to determine the factors affecting performance and identifying their impact. Our findings revealed that expense ratio, claims ratio and the size of a company significantly affect insurance companies’ performance negatively. Whilst leverage and liquidity affect performance positively. We recommend that insurance companies should introduce mechanisms that reduces operational costs such as automated systems.
An Examination of the Impact of Total Quality Management on Customer Satisfaction in the Zimbabwean Insurance Industry
(IAMURE Multidisciplinary Research, 2017-04) Mazviona, Batsirai Winmore
The subject of total quality management (TQM) is increasingly becoming topical worldwide, chiefly because of current intensified competition in the financial markets. Consumer satisfaction is an important determining factor in a company’s success. Quality frameworks and programs should be dynamic to meet the ever changing customer expectations and preferences. The Zimbabwe insurance industry has been labeled as poor and delivering poor services to the insured. Furthermore, insurance policyholders have raised concerns and complaints about the sub-standard services that they are getting from their insurers. Thus the research was aimed at investigating TQM’s impact on customer satisfaction in the insurance industry. Data and information necessary in the achieving of the research objectives involved the use of mainly primary data through the use of questionnaires. The data was gathered in Bulawayo from insurance consumers and insurance companies’ employees. The descriptive research approach was utilized in this study. Chi-square tests were used to examine hypotheses. The fundamental findings from this study are that insuranceconsumers in Zimbabwe are not satisfied with the services they are getting from their insurers. It is concluded that insurers should implement TQM as a holistic approach towards meeting and exceeding customers’ expectations to enhance customer satisfaction.
Managing Pension Funds in Zimbabwe: Ethical Issues and Challenges
(David Publishing, 2013-07) Mazviona, Batsirai Winmore
This article is motivated by the predicament that hit pensioners in Zimbabwe following the introduction of the multi-currency system. Zimbabwe experienced economic woes which rendered the Zimbabwean dollar worthless and consequently necessitating a switch to stable currencies. The pension assets and liabilities were invested in the local currency before the currency reform, and the result of the multi-currency system was a mismatch of the assets and liabilities of the pension funds financial position which led to paltry pension benefits. The nature of pension funds places a great responsibility on the stakeholders who are involved in running these schemes and therefore ensuring that reasonable expectation by beneficiaries is met. The article focuses on the core aspects surrounding the structure and managing of pension funds in Zimbabwe. The researcher investigated the roles of important stakeholders in the Zimbabwean pension industry, namely, government, trustees, investment managers, and actuaries. The article further delves into the ethical issues and challenges faced by those managing Zimbabwean pension funds. The researcher conducted a total of 30 personal interviews to collect primary data from professionals in the Zimbabwean pension industry which were split as follows: 10 trustees, 10 investment managers, and 10 actuarial consultants. Secondary data were also used in this study and it comprised of journals, newspaper articles, investment reports, and textbooks. The researcher recommends that pension funds develop sound corporate governance mechanisms that will encourage the best ethical practices among all of their stakeholders. The findings provide evidence for a need to empower pension fund trustees through training and introduction of a pension protection scheme. In addition, the current regulatory system needs to be reviewed to capture the changing economic environment upon which pensions funds operate.
Measuring Investor Sentiment On The Zimbabwe Stock Exchange
(AESS Publishers, 2015) Mazviona, Batsirai Winmore
Investor sentiment is belief about future cash flows and investment risks not justified by current relevant information. Additionally, investment decisions made without support from information. In classical finance theory, investor sentiment does not play any role in the cross-section of stock prices, realized returns, or expected returns. But inexplicable events such as the crash of October, 1987, The Great Crash of 1929, the Tonics Boom and Go-Go Years of the 1960s, the Nifty Fifty bubble of the 1970s have cast doubt on the standard finance model in which stock prices equal the rational expectations of unemotional investors. Behavioural finance attempts to explain these disparities using investor sentiment. The aims of the study are to document market measures of investor sentiment and to demonstrate whether investor sentiment exerts an influence on the Zimbabwe Stock Exchange. Daily return and trading volume data of 66 stocks, excluding delisted and suspended stocks, for the period from 19 February 2009 to 31 December 2012 were considered. A high-low volume sentiment indicator variable is introduced to distinguish when the market has higher or lower sentiment. An ordinary linear regression was used to show the evidence of the effect of investor sentiment indicator on stock returns. The researcher found that approximately 40% of the market moved contrary to the market sentiment indicator. The remaining 60% co-moved with the sentiment indicator, with the level of effect differing in magnitude, indicating that the sentiment indicator had a positive effect on the indicator. However, these results though are not statistically robust using the binomial test as only five out of the sixty-six stocks (approximately 7%) were significant at a 5% interval. This is less than the number of significant results expected under the null hypothesis. Hence, the null hypothesis cannot conclusively be accepted or rejected, and the effect of the sentiment indicator on returns could not be completely ruled out or established.
Microfinance Regulation and Supervision in Zimbabwe: A Critical Overview
(Mediterranean Journal of Social Sciences MCSER Publishing, 2016-01) Makuyana, Tsanangurai
This paper critically evaluates the key provisions of the new Microfinance Act in Zimbabwe and other related pieces of legislation. The study is not an exposition of debates and theories about microfinance regulation and supervision in general but one focused on a specialized piece of law and its related institutions. The aim of the study is to evaluate the regulatory framework at place for microfinance business in Zimbabwe in order to establish the extent to which the growth of the microfinance sector is promoted from a legal point of view. The classical legal research method was employed in this study wherein a critical analysis of the law was done and leveraged through a review of related literature. The paper concludes that a new specialised microfinance law in Zimbabwe is a welcome development although certain aspects of the law still need improvement.
Modelling Day of the Week Effect on the Zimbabwe Stock Exchange
(Scienpress Ltd, 2016-05-01) Mazviona, Batsirai Winmore; Ndlovu, Milton Webb
The study examined the day of the week effect on the Zimbabwe Stock Exchange (ZSE). The objective of the study was to relate the overall stock market returns to the individual returns of trading days (Monday, Tuesday, Wednesday, Thursday and Friday). The aim was to establish whether returns of trading days were statistically different from each other. The ordinary least square regression model was used to model the returns. The study focussed on ZSE stocks with data from 19 February 2009 when the ZSE started to trade in United States dollars to 31 December 2013. A total of 62 stocks were used in this study. These stocks constitute the Industrial and Mining indices. Industrial and mining indices data were also utilised in the modelling exercise. Data was obtained from the ZSE website and other secondary data were sourced from journal articles, papers and reports. Data analysis was done in EViews 7. We found little presence of day of the week effect, about 26% of the stocks had significant positive and negative returns. We conclude that the mean returns of the stocks on the ZSE under the study period do not vary across trading days at the 5% level of significance.
Perceptions of Healthcare Workers on the Attributes of the Integrated Disease Surveillance and Response System in Zimbabwe
(2024) Mteliso, F.; Adalier, A.; Malunguza, N.J.; Chiyaka, E.T.
Objective: To investigate healthcare workers' perceptions of the integrated disease surveillance and response (IDSR) strategy. Methods: A cross-sectional survey of healthcare workers (HCWs) was conducted from December 2021 to June 2022 to assess their perceptions of the IDSR system attributes. Results: Of the 409 respondents, 12 (2.9%) reported no prior training on disease surveillance. The IDSR was deemed simple, acceptable, useful, and timely by most participants. There were sharp differences in perceptions of flexibility and simplicity between doctors and the other healthcare professionals. However, acceptability, timeliness, and usefulness were uniformly perceived. Healthcare workers with at least 11-years’ experience perceived the usefulness of the IDSR system significantly higher than those with lesser years of experience. However, work experience did not have an impact on HCWs perceptions of the simplicity, timeliness, and flexibility of the IDSR system. Conclusions: Most healthcare workers have positive perceptions of the IDSR approach. However, there are reservations about how well the system can adapt to changing conditions and demands (flexibility) and how well it simplifies the implementation processes. These findings demonstrate the necessity of adopting cutting-edge strategies for capacity building as well as ongoing professional development of healthcare professionals responsible for the implementation of the IDSR strategy.
A Review of Foreign Investments Allowance for Pension Funds in Zimbabwe
(Mediterranean Journal of Social Sciences MCSER Publishing, 2014-05) Chowa, Taonaziso; Mhlanga, Richard
The hyperinflation era in Zimbabwe (2003-2008) eroded pensioners’ capital values and has seen pre-dollarisation retirees receiving paltry pension payouts from year 2009. We review global trends on foreign investments for pension funds in order to add input to the local debate pitting the Zimbabwe Association of Pension Funds (ZAPF) members against the Insurance and Pensions Commission (IPEC) on whether the Pension and Provident Fund Act [Chapter 24:6] of Zimbabwe should permit foreign/offshore investment. We interview ZAPF members & partners and carry out secondary analysis of data on pension payouts, asset management and life & pensions asset allocations and returns post-dollarisation. Findings reveal that meeting liquidity and diversification goals require allowances for foreign investments. ZAPF members and partners would welcome any level of foreign investments allowance, despite Zimbabwe offering weighted returns that are above those currently obtainable from foreign assets. We conclude that there is lack of confidence in the long-term sustainability of the capital values and returns given that the tenure of the prevailing Multi-Currency System (Dollarisation) is uncertain and hence the need to allow limited foreign investment by pension funds.
Risk and Concentration of Portfolios on the Zimbabwe Stock Exchange after Currency Reform
(2014) Mazviona, B. W.; Nyangara, D.
Aims: The objectives of this study are to assess the level and impact of concentration of portfolios on the ZSE and to determine the number of stocks to be held in a concentrated portfolio to achieve effective risk reduction. Study Design: Portfolio Model. Place and Duration of Study: Zimbabwe, Department of Insurance and Actuarial Science and Department of Finance, between February 2013 and March 2013. Methodology: We analysed the level of concentration of portfolios held on the Zimbabwe Stock Exchange (ZSE). The market capitalization weights and the daily closing prices of 62 stocks in the industrial index for the four-year period form 19 February 2009 to 31 December 2012. Results: The Herfindahl-Hirschman Index and the Roll measure of concentration were employed to analyse the level of concentration of portfolios mimicking the industrial index and it was observed that portfolios held on the ZSE are highly un concentrated with an approximate measure of 14% under the HHI measure as at 31 December 2012. The daily returns over the period were calculated and used to estimate the risk of the portfolio. The findings indicates that stocks in the industrial index of the ZSE have relatively low correlation due to the small difference in risk between equally weighted portfolios with nocorrelation and equally weighted portfolios with historical correlation. Conclusion: The empirical evidence highlights that an optimal portfolio size averaging 20 to 25 stocks of the Industrial Index stocks will have to be included in order to achieve effective risk reduction.
Risk Management Practices for Short-Term Insurance in Zimbabwe
(2014-07) Mazviona, Batsirai Winmore
The study examined the current risk management practices of insurance companies and revealed that the risk management practices are not adequate. The objective of the study was to document the risk management practices in the short-term insurance industry. The key features investigated are risk management culture, risk control and extreme event management. A questionnaire was used as a research instrument for data collection. Closed questions were structured on a five point Likert-scale. A total of eighty six questionnaires were sent to short-term insurance companies. Purposive sampling was used to come up with research participants. The research participants comprised of claims processors, credit controllers, interns, managers and underwriters in the short-term insurance industry. The study period was from February 2013 to May 2013. The analysis was carried out in SPSS 16.0. Additionally, secondary sources which include journal articles were used to supplement the primary data. There is poor risk management culture in short-term insurance companies. The results show that the risk management practitioners in the Zimbabwean short-term insurance industry are not appropriately qualified and management does not view risk management as a tool that can provide their firms a competitive edge. Insurance companies have measures in place to manage high frequency low severity events, however have no measures in place to envision and manage low frequency high severity events. The implications of these findings are that, for a new approach like Enterprise Risk Management (ERM) to succeed there has to be a paradigm shift in the Zimbabwean short term insurers’ approach to risk management the first being to strengthen their risk management culture. The efforts to adopt ERM must start in the board room and the short term insurance companies should integrate risk management into their organisation’s objectives, philosophy, practices, and strategic plans.
Some Aspects of the New Microfinance Law in Zimbabwe
(MCSER, 2017-05) Makuyana, Tsanangurai
This paper analyses the new Microfinance Act [Chapter 24: 29] in order to reveal the shortcomings in the law and to suggest areas of possible improvement. The study was carried out using a purely desktop legal research method wherein a critical review of the piece of legislation was done against the theory surrounding microfinance business principles. The study concluded that the new Microfinance Act in Zimbabwe has a considerable number of shortcomings born out of both drafting loopholes and outright lack of thrust of principles promotive of the growth of the microfinance sector in the country.

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