The Insurance and Pensions Commission has raised concern over growing unclaimed pension benefits and persistent compliance gaps across the sector, while warning that failure by pension funds to remit benefits older than five years constitutes a breach of the law as provided for under the Estate Administration Act.
According to IPEC's Pensions Report for the half year to June 2025, unclaimed benefit liabilities surged to US$15,9 million, up from US$15,4 million in the previous quarter.
The total number of members with unclaimed benefits also rose slightly to 100 354, an increase of 0,74 percent from March.
IPEC said the increase in unclaimed benefits was mainly due to pension adjustments and bonuses awarded to members.
Keep up with the latest headlines on WhatsApp | LinkedIn
The commission's analysis revealed that stand-alone funds account for the largest share of members with unclaimed benefits to the tune of 81,4 percent, followed by insured funds 12,5 percent and self-administered funds 6,1 percent.
However, when it comes to the total value of the unclaimed benefits, insured funds hold the highest amount, at US$147,4 million, compared to US$141,1 million under self-administered schemes and US$118,1 million in stand-alone schemes.
"The commission is encouraging the industry to intensify efforts to locate members and surrender unclaimed benefits that are over five years old to the Guardian Fund," IPEC said in the report.
The regulator further noted that most of the unclaimed benefits fall within the 0-2-year period, but administrators continue to hold onto benefits exceeding five years, in violation of statutory requirements.
"IPEC is concerned about the industry's non-compliance with the Act and the ongoing difficulty in locating members who have unclaimed benefits," the commission added.
The report highlights some discontent among members.
During the first half of 2025, IPEC received 118 complaints, of which 92 were resolved while 26 remained outstanding.
Of these, 25 were complex complaints; with only five resolved, while 93 were non-complex and the majority were successfully handled. IPEC's report shows that low benefit payouts and unpaid benefits, together, accounted for 65 percent of all complaints.
"The Commission noted that low benefits paid to members constituted 33 percent of all complaints received, with unpaid benefits following closely at 32 percent," the report stated.
The remaining issues include information-related disputes, accounting for 13 percent, 2009 compensation grievances, 11 percent, and minor issues such as delays in payment or non-remittance of benefits, 3 percent each.
A significant share of unresolved cases stemmed from non-remittance of contributions by sponsoring employers, a recurring problem that continues to weaken members' retirement security.
"The commission is actively engaging sponsoring employers to address the issue of unremitted contributions to ensure members receive the support they are entitled to," IPEC said.
Economic analyst Tinashe Mudzengi described the findings as a worrying reflection of inefficiencies in pension administration, saying that the rising pool of dormant benefits erodes trust in the pension system.
"When workers cannot access what they have rightfully earned, confidence collapses. Regulators and administrators must leverage digital tools, from mobile-based verification to data sharing with the registrar's office, to trace beneficiaries faster," Mr Mudzengi said.
Another pensions expert, Ruvimbo Nyamadzawo, said that compliance with the Estate Administration Act must be enforced rigorously.
"Funds holding unclaimed benefits beyond five years should face penalties. The Guardian Fund exists to protect those entitlements, not for administrators to delay indefinitely," she argued.
Sign up for free AllAfrica Newsletters
Get the latest in African news delivered straight to your inbox
The commission's findings expose long-standing structural issues in the pensions sector, including data management to contribution remittance. Analysts say without digital integration and stricter oversight, the backlog would persist.
Ms Nyamadzawo urged the sector to embrace transparency, "Publishing unclaimed benefit lists publicly and enabling online claims portals could drastically reduce the backlog. Technology can bridge the gap between administrators and rightful beneficiaries."
As the regulator tightens its supervision and engages defaulting employers, the spotlight now shifts to fund managers' compliance levels and the fate of thousands of pensioners waiting to access their savings.
"The pension industry's credibility rests on timely, transparent benefit payments," said IPEC. "Every unpaid dollar is a deferred promise to a worker who has already done their part."
