FSA fines Sun Life of Canada £600k for governance failings
by Gill Montia
Story link: FSA fines Sun Life of Canada £600k for governance failings
The Financial Services Authority (FSA) has fined Sun Life Assurance Company of Canada (UK) Limited (SLOC UK) £600,000 for failings in the governance of its with-profits business. According to the regulator, the design and operation of SLOC UK’s governance arrangements were “unclear and inadequate”, resulting in a high risk that policyholders’ interests weren’t protected properly. [...]
Standard Life cuts with-profits bonus rates
by Gill Montia
Story link: Standard Life cuts with-profits bonus rates
Standard Life is reducing some of its UK with-profits bonus rates. The life and pensions provider says most plans increased in value in the year to 1st February but guarantees are building up, and it needs to ensure its with-profits fund can meet all guarantees. The company explains: “We expect asset classes such as equities [...]
Enhancement for Equitable’s departing with-profits policyholders
by Gill Montia
Story link: Enhancement for Equitable’s departing with-profits policyholders
Equitable Life says it has earmarked a sum equivalent to 12.5% of policy values (as at 31 December 2010) which will be used to enhance payments for with-profits policyholders who leave. The move is aimed at giving policyholders quitting the society a fair share of the capital held, while leave enough for those who remain. [...]
FSA sets out with-profits communication issues
by Gill Montia
Story link: FSA sets out with-profits communication issues
In its 2011/12 business plan, published yesterday, the Financial Services Authority (FSA) says it will be following up on proposals to strengthen the effectiveness of its with-profits regime. In particular, the regulator will consult further in 2011 on policyholder communications, having identified “significant weaknesses” in the quality of consumer communications. The FSA states: “We do [...]
LV= reports strong with-profits performance
by Richard Kilner
Story link: LV= reports strong with-profits performance
LV= has reported its annual with-profits performance and payouts for 2010, including a with-profits fund investment return of 15.5% (flat with 2009′s 15.4% return). The firm’s mortgage endowments performed well, with a 20 year policy covering a £50,000 mortgage presently paying a surplus of £8,000. Furthermore, the firm’s mortgage endowment guarantees that policies paid to [...]
PRA to adopt “less intensive” supervisory approach for insurers
by Gill Montia
Story link: PRA to adopt “less intensive” supervisory approach for insurers
In its consultation document on the new regulatory regime published yesterday, the Government has confirmed that the general principle underpinning its model of dual regulation will apply to the insurance industry. That is to say, the conduct of business and consumer protection issues are the preserve of the Financial Conduct Authority (FCA), while the Prudential [...]
Prudential to acquire AIG’s £15bn Asian business
by Gill Montia
Story link: Prudential to acquire AIG’s £15bn Asian business
Prudential is looking to acquire AIA, the Asian business of embattled US insurance giant, American International Group (AIG), the BBC has reported. Talks are understood to be at an advanced stage and a statement from Prudential on a £15 billion deal is expected in the days ahead. The group’s ambitions in Asian markets are well [...]
Royal London and Royal Liver explore merger
by Gill Montia
Story link: Royal London and Royal Liver explore merger
Royal London is reported to be in talks with Royal Liver regarding a takeover. Established as a friendly society in 1850, Royal Liver offers a range of financial products including mortgage and insurance services, whereas Royal London is recognised as the UK’s largest mutual life and pensions provider. The idea of a merger between the [...]
Friends declares “a good year for with-profits”
by Gill Montia
Story link: Friends declares “a good year for with-profits”
Friends Provident has announced a rise in some bonus rates, having declared “a good year for with-profits”. The life and pensions provider’s gross investment return on its with-profits fund stood at 9.3% in 2009 and all final bonus rates have either increased or remained unchanged from a year earlier. In addition, market value reductions (penalties [...]
Standard Life freezes with-profits bonus rates
by Gill Montia
Story link: Standard Life freezes with-profits bonus rates
Standard Life has frozen bonus rates for over a million unitised and conventional with-profits policyholders. The life and pensions provider says most customers will still see an increase in their plan values but for the less fortunate, a £200 a month with-profits pension plan taken out in 1990 by a male retiring aged 65 now [...]
Aviva offers money-back guarantee to with-profits investors
by Gill Montia
Story link: Aviva offers money-back guarantee to with-profits investors
Aviva is introducing a continuous money-back guarantee option for new with-profits investments. The insurer says the move is in response to customer demand and will give savers peace of mind. The guarantee will be available from 30 November 2009 on new investments in the group’s With-Profit Guaranteed Fund. It means that investors moving out of [...]
Aviva’s Delta Lloyd IPO to net €1.2bn
by Gill Montia
Story link: Aviva’s Delta Lloyd IPO to net €1.2bn
Aviva has announced that the flotation of its Dutch business, Delta Lloyd, on Euronext Amsterdam should raise between €2.6 billion and €3.1 billion, with shares priced between €15.50 and €19. Assuming a mid-range outcome, the initial public offering (IPO) of the 42% stake could provide the group with a cash injection of €1.2 billion, some [...]
Aviva sets out with-profits reattribution terms
by Gill Montia
Story link: Aviva sets out with-profits reattribution terms
Aviva has confirmed details of the reattribution of the with-profits surplus from its CGNU and CULAC funds, having secured High Court approval for the settlement earlier this month. The final value of the reattribution stands at £1.25 billion and the total payout to policyholders is worth £470 million, meaning that 90% of eligible customers will [...]
High Court approves Aviva’s reattribution offer
by Gill Montia
Story link: High Court approves Aviva’s reattribution offer
Aviva has been successful in securing High Court approval for the proposed reattribution of its with-profits surplus. With-profits policyholders holding CGNU and Culac policies that were in force on November 21st 2006 should now receive between £200 and £1,000 before the end of the year, tax free. In return beneficiaries will surrender any future interest [...]
Aviva reattribution dissenters attend High Court
by Gill Montia
Story link: Aviva reattribution dissenters attend High Court
A group of Aviva policyholders will have their grievances heard in the High Court today, as the insurer seeks legal approval for the reattribution of its with-profits surplus. Aviva is proposing that a windfall of not less than £200 and up to £1,150 be paid to with-profits policyholders holding CGNU and Culac policies that were [...]
Aviva extends reattribution voting deadline
by Gill Montia
Story link: Aviva extends reattribution voting deadline
Aviva has extended the deadline for its ballot on the reattribution of its with-profits surplus by one month, to 21st September. The insurer is proposing that a windfall of not less than £200 and up to £1,150 be paid to with-profits policyholders holding CGNU and Culac policies that were in force on November 21st 2006. [...]
FSA tightens usage of with-profits surpluses
by Gill Montia
Story link: FSA tightens usage of with-profits surpluses
The Financial Services Authority (FSA) has announced that life insurance companies will no longer be able to meet compensation and redress payments from their with-profits funds. From 31st July, liabilities arising from operational failures (including mis-selling) must be borne by shareholders, not policyholders. Last year, a report by the Treasury Select Committee accused the FSA [...]
Aviva progresses reattribution offer for NU policyholders
by Gill Montia
Story link: Aviva progresses reattribution offer for NU policyholders
Aviva is inviting Norwich Union with-profits policyholders to vote on the proposed reattribution of surplus funds. Negotiations over the reattribution have dragged on for well over a year because of a dispute over the proportion of the surplus that should be paid to shareholders. In July 2008, Aviva announced that it was prepared to pay [...]
NU with-profits reattribution devalued to £400m
by Gill Montia
Story link: NU with-profits reattribution devalued to £400m
Norwich Union (NU) with-profits policyholders who have been waiting patiently for news of the reattribution of surplus funds will be disappointed to learn that parent company, Aviva, has fixed the total payout at £400 million rather than the £1 billion promised earlier. In July of last year, Aviva announced that it was prepared to pay [...]
L&G posts £1.49bn loss
by Gill Montia
Story link: L&G posts £1.49bn loss
Legal & General (L&G) has posted a pre-tax loss of £1.49 billion for 2008, compared to a profit of £883 million in 2007. The insurer has also reported that its capital surplus stood at an estimated £1.5 billion in March, down from £1.6 billion in February. The change reflects the group’s decision to double its [...]
