norwich union wth profits reattirbution

"biggirlsblouse" wrote

"Stolen" from whom? Who do you think it belonged to before?

It belongs to the withprofits policyholders to which it would have provided a fair bonus instead of the poultry returns we have all had...and still continue to have..of course leaving enough for the fund to operate in bad times for the "smoothing effect" and return to the company (and the shareholders, of which by the way I am one) a fair and reasonable profit, not taking it away to "develop future business". That what the normal profit is for.

Sorry...spelling mistake...that should be paltry...not poultry. I am hungry and about to eat a chicken salad!

"biggirlsblouse" wrote

Why do you think that?

"biggirlsblouse" wrote

But bonus is declared through a (usually 90/10) "gate", isn't it?

"biggirlsblouse" wrote

Eh? "Developing future business" is surely one of the best things to use the inherited estate for, which would then benefit both shareholders *and* policyholders when the profits from that new business is released...

Well I have to say that if it is 90/10 gate then we have been shortchanged for at least 3 years!... because the amount of bonus over my entire 10 years investment has hardly achieved RPI (if you include the bonus as compounded)

"biggirlsblouse" wrote

Eh?

"biggirlsblouse" wrote

That's not inconsistent with a 90/10 gate, is it?

In message , biggirlsblouse writes

I dont follow that at all. Can you explain further? I dont see what RPI has to do with it.

It's a shame that this perfectly decent question about 'orphan funds' is being side-tracked (deliberately?) by irrelevancies. The fact is that the orphan funds have presumably been built up by over-deductions from policyholders in the past. Short of tracking these people down and handing them some extra dosh, it does seem a sensible question what should happen to the money. Giving it to the shareholders does not seem a particularly good idea, particularly as it will simply encourage company management to withhold still more money in future. In a 90-10 fund, I cannot see that shareholders should, in any case, get more than 10% of the orphan funds allocated to them.

In message , GB writes

No,

I was responding to a point made by the OP. Like you, I could see what his point was in relation to the thread, and was questioning his reasoning as well...

The money should have been given to the policy holders by increasing bonuses IMHO.

However the shareholders will get most of them just as with AXA.

Bear in mind that these funds come from more than one life office, e.g. Commercial Union and General Accident, both of which include many names from the past. I think you'll find that the greater part of the distribution will be allocated to policyholders. The proposed distribution of funds relates only to the funds of those offices, now known as CULAC and CGNU and would take place when the relevant life funds are merged with the main NU life fund.

Have a look at

Norwich Union life and pension policy holders had their rake-off when the NU was "demutualised" some years ago, by means of a share distribution.