Aviva, a provider of life and pension products, has announced that its Dutch business, Delta Lloyd Group, and the Verliespolis and Woekerpolis Claim Foundations have reached an agreement on a financial compensation arrangement for unit-linked insurance policyholders.
The agreement represents a considerable improvement for customers on the recommendation made by the Financial Services Ombudsman in March 2008. It simultaneously constitutes the mediation result of an earlier case that Verliespolis had taken to the Ombudsman against Delta Lloyd.
The foundations jointly represent some 200,000 policyholders. The VEB (Association of Stockholders), the VEH (Homeowners’ Association) and the Financial Services Ombudsman support the result achieved after months of negotiations.
The current value of the compensation for Delta Lloyd Group amounts to approximately E300 million, including a maximum of E30 million for a fund to assist customers in ‘distressing’ situations. In addition, Delta Lloyd Group had already reserved E110 million to guarantee the returns for customers with insurance policies containing a guaranteed minimum return.
In conformity with the earlier recommendation of the Ombudsman, the compensation currently agreed by Delta Lloyd Group, Verliespolis and Woekerpolis Claim provides for a maximization of the costs per policy on maturity date. Within this agreement risk premiums are limited and will be based on recent mortality tables. In March 2008, the Ombudsman had still assumed a maximum of 3.5% costs for a unit-linked insurance policy without guarantees and a maximum of 4.5% costs for a unit-linked insurance policy with a guarantee of at least 3% on the net fund return.