MORE than 800,000 Aviva policyholders are to share £470 million after the insurance giant completed a long-running reattribution deal today.
As part of the process, policyholders were offered a cash windfall in exchange for giving up their rights to any future redistribution of the surplus assets that have built up in the group’s with-profits funds.
Just over 87% of eligible policyholders voted during the process, with 96% of them choosing to accept the offer. With regulatory and other approvals now in place, Aviva will mail cheques to customers from next month.
The majority will receive between £214 and £1,230, with the remaining 10% getting more.
The group had originally hoped to pay out a minimum of at least £400 per person, but pulled the offer in February due to steep stock market falls.
Mark Hodges, chief executive Aviva UK Life, said he believed the offer was fair to both shareholders and policyholders.
He added: "I’m particularly pleased that we’ve been able to conclude the process in time for most customers to receive their payments by Christmas."
The inherited estate was valued at £2.1 billion in June last year, shortly before the reattribution offer was announced, but the figure had fallen to £1.2 billion at the latest valuation.
The amount policyholders will receive is based on the average valuation in June, July and August.
The final payments are slightly higher than the indicative offer mentioned in voting packs, as the final value of the inherited estate came in higher than the minimum level of £1.2 billion on which the offer was based.
It is estimated that the reattribution will free up £650 million of additional capital from the inherited estate, which will be used to underwrite new policies.