Zimbabwe’s insurance and pensions industry has accumulated almost US$4.9 billion in assets, but much of that capital remains tied up in property and equities, limiting the amount available for new investment and exposing a gap between the country’s growing pool of long-term savings and its development financing needs.

Speaking at the Zimbabwe Economic Development Conference in Bulawayo, Insurance and Pensions Commission (IPEC) Commissioner Grace Muradzikwa said pension funds accounted for US$3.47 billion of the industry’s assets at June 30, 2026, followed by life assurance at US$855 million, short-term insurance at US$545 million and funeral assurance at US$36 million.

The pension fund component had grown by 32% over the year, but its composition limits how quickly that money can be redirected into new projects. About 73% of pension assets are held in property and shares, according to IPEC, meaning a substantial portion of the industry's wealth is already committed to existing investments rather than sitting as cash for fresh projects.

“Prescribed assets projects must offer value for money,” Muradzikwa said, stressing that institutional savings could not simply be channelled into projects without considering their investment performance.

“We cannot afford just to give prescribed assets to any project because we really have very limited new money,” she said.

The concentration in property also presents its own constraints. IPEC's presentation noted that assets are not the same as cash and that property holdings can be difficult to convert into new investments because of perceived undervaluation linked to rental vacancies.

Tax treatment is another obstacle. The presentation noted that transferring properties into real estate investment trusts can be inhibited by VAT, even where there is no change in ownership. Such restrictions can make it harder for pension funds to restructure portfolios and move capital into investment vehicles better suited to infrastructure and other development projects.

The scale of the challenge is reflected in Zimbabwe's prescribed-assets programme. Since 2021, IPEC has approved about US$2.5 billion for prescribed assets, under a framework designed to direct institutional savings towards development projects. Yet some projects have reportedly secured only about 30% of the funding they required, showing that approval for prescribed-asset status does not automatically translate into full project financing.

Muradzikwa said the regulator also had to protect the interests of the people whose money is being invested.

“We also need to bank only bankable projects,” she said, highlighting the need to balance development objectives with “the return on investment for policyholders.”

That balance is central to the role of pension and insurance funds. Their long-term liabilities make them potentially important sources of financing for infrastructure, housing, energy, agriculture and industrial projects, but the money ultimately belongs to pension members and policyholders and must generate returns while remaining appropriately protected.

The asset breakdown shows both the scale and the limitations of this pool of capital. Pension funds represented about 71% of the US$4.9 billion industry asset base, with life assurance accounting for about 17%, short-term insurance 11% and funeral assurance about 1%.

The issue is not simply that Zimbabwe lacks domestic savings. The country has accumulated a sizeable institutional capital base, but a large share is already invested in assets that cannot easily be converted into cash without affecting valuations, returns, or the interests of beneficiaries.

Unlocking more of that capital requires a combination of better investment structures, improved liquidity, appropriate tax treatment, and a stronger pipeline of projects capable of meeting institutional investment requirements.

For policymakers, pension and insurance funds offer a domestic source of long-term capital at a time when Zimbabwe continues to require financing for infrastructure and productive investment.