Norwich Union GBP3bn With Profits Share

Norwich Union £3bn With Profits Share

Advisers have backed Aviva policyholder advocate Clare Spottiswoode over policyholder rights to Norwich Union’s £5.5bn inherited estate.  Norwich Union said it will pay £2.3bn in special bonuses to with-profits policyholders, an average payout of £1,900 each, over a three-year period, and £230m will be divided among shareholders.  Policyholders do not have an automatic right to the remaining £3.2bn because they are agreeing to give up the rights to any future payouts from the estate by accepting a payout from shareholders under the reattribution process.

Spottiswoode is arguing that under the reattribution process, the remaining £3.2bn rightfully belongs to the policyholders and should be split with 90 per cent going to policyholders and 10 per cent to shareholders.  Norwich Union chief actuary
John Lister says the remainder of the money is needed to provide capital to protect against adverse circumstances such as stockmarket falls, smoothing and the capital to support new business.

Our view

This is the policyholders money anyway, so we do not see this as such a big deal.  Norwich Union, along with all other ‘with profits’ funds.

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