No Confirmation on NU Reattribution Until 2010

IFAOnline, UK – 23 February 2009

Norwich Union's with-profits policyholders are unlikely to receive their cash from the reattribution of its inherited estate until 2010.

As the firm now wishes to negotiate a variable figure for the reattribution, eligible investors are now faced a degree of uncertainty over how much money will receive.

Norwich Union will announce the new value of its inherited estate on 5 March, which is expected to have fallen significantly from the £2.1bn valuation of July 2008.

The firm hopes to have negotiated a new deal with policyholder advocate Clare Spottiswoode by early April.

However, the legal process, which has to gain High Court and FSA approval, means policyholders will have to wait for more than eight months before knowing how much money their will receive.

Norwich Union Life's chief actuary, John Lister, says the firm hopes to negotiate a variable payment to prevent a future re-negotiation if market conditions change markedly in the next year.

"We have a number of options available," he says.  "We could use a fixed number, a range of values or a percentage of the estate's value.  We would prefer to use something that varies."

Payments were made to some policyholders last year, with further payments due in 2009, but the size of final payments, due in 2010, will not be known until the full legal process is completed in late 2009 or early 2010