HARARE - CBZ Life has suspended insurance cover for Members of Parliament’s vehicles after government failed to pay full comprehensive cover for the 370 vehicles.
MPs and senators were given Ford Ranger vehicles from Croco Motors on loan two months ago under Section 1.2 of the Addendum to the Parliamentary Vehicle Loan Scheme.
The comprehensive cover for the motor vehicle was supposed to run for a period of 12 months.
The lawmakers were advanced a $35 000 vehicle loan by Treasury to purchase the vehicles.
While government had entered into an agreement with CBZ to pay Croco Motors the $35 000 per vehicle, they were supposed to pay directly for the vehicles’ insurance, estimated to be about $790 per vehicle. But government has however failed to pay.
On July 18, 2014, CBZ Life wrote to MPs to inform them that it had suspended cover on all policies.
The situation has prompted Austin Zvoma, the clerk of Parliament, to write to the MPs and the Finance ministry registering his displeasure that government was not sticking to its contractual obligations.
“The regrettable situation is contrary to the letter and spirit of the agreement entered into,” Zvoma said in a letter.
“The administration of Parliament has requested both the ministry of Finance and CBZ to expeditiously resolve the impasse so the members are not duly disadvantaged and will provided feedback on any development on this matter.”
In its earlier correspondence to the legislators, CBZ Life had informed them that according to the bank’s policy, their vehicles remain uninsured until the first premium has been paid.
“We therefore confirm that cover on this policy has been suspended with effect from the date it was given and that no claim under this policy will be entertained by CBZ,” wrote Norbert Mureriwa, the CBZ Life managing director.
CBZ Life Limited was established in 2010 and licensed to transact long term insurance business. CBZ Holdings has 100 percent shareholding in the company.
The MPs Ford Ranger vehicles, which cost about $12 million, were purchased at a time government is struggling to pay civil servants’ salaries on time.
The purchase of the off-road vehicles has further rocked the boat for a government accused of profligate spending on perks for ministers and government officials while turning a blind eye to the plight of lowly paid civil servants.
Government also reportedly spent about $6 million recently to buy 100 fuel-guzzling vehicles for ministers.