NU with-profits reattribution on shaky ground
The recent turmoil in the financial markets has led to speculation that Norwich Union’s (NU) long-awaited reattribution of its with-profits surplus could be shelved.
In July, NU’s parent company, Aviva, announced that it would be prepared to pay a windfall that would average £1,000 per policyholder, to customers who had invested in GCNU Life or CULAC with-profits funds, before November 21st 2006.
At that time, Aviva said around 700,000 customers should receive between £400 and £1,000, while a further 220,000 should receive between £1,000 and £3,500.
The reattribution split the surplus cash between policyholders and shareholders 70%:30% in favour of policyholders and payments were scheduled for early 2009.
According to a report in The Times, Aviva is poised to announce that it will have to reconsider the plan because of falling stock markets, which have been undermining the capital positions of UK insurers.
The terms of the reattribution will always have been subject to market conditions and it is understood that the agreement, which was negotiated with policyholder advocate, Clare Spottiswoode, can be reviewed if the FTSE 100 index falls below 5,000.
On Friday of last week, the FTSE 100 closed at 3,883.
Category: Aviva News, Norwich Union Insurance News
Visited 3120 times, 1 so far today
Comments (0)
Trackback URL | Comments RSS Feed
There are no comments yet. Why not be the first to speak your mind.