Policyholders with a leading insurance company are to get a bumper boost to their policies at the end of this month.
t comes after policyholders of Royal London in this country voted in favour of a scheme that will see excess funds paid into their pension and life assurance policies.
Some 93,000 people who have old Royal Liver, Caledonian Life and some Irish Life policies are set for an average top-up to their policies of €900 on December 31.
It follows Royal London’s takeover of Royal Liver, which was approved by the then Competition Authority in this country in 2011.
The funds are being distributed to policyholders due to the freeing up of a pot of money that was held back for a “rainy-day fund” at the start of the takeover process – in case there were any claims on the company .
Royal London said 95.9pc of the Irish policyholders voted in favour of the spare funds being added to the value of their policies.
The High Court in Dublin approved the scheme at a hearing last month.
In the UK the vote passed with 96.41pc of those policyholders who voted. The UK scheme has now been approved by a British court.
“As the offer was approved by both the UK and Irish courts, the money will be applied to the policies on December 31, 2022,” Royal London said.
The takeover by Royal London of Royal Liver meant Royal Liver then became part of Royal London, which is the largest mutual life, pensions and investment company in the UK.
Royal Liver used to have a huge insurance operation in this country with premiums collected door-to-door by people who were known as the Liver Men. Caledonian Life was acquired by Royal London at the same time as the takeover of Royal Liver, and rebranded as Royal London.
Royal London is a mutual, which means it is owned by its members and any financial surplus profits go to its policyholders.
Some 93,000 policyholders here, who have endowment policies, whole-of-life policies and pensions, are due a boost to the value of the plans.
There have already been a number of what are known as distributions of funds from the takeover of Royal Liver for Irish policyholders.
These were in 2013, 2018, 2019 and earlier this year, with the amounts paid into policies depending on the size of the person’s policy. But this latest one is the biggest.
Royal London said: “Whenever there is more money in the estate than required, the extra money is shared with eligible policyholders by increasing the underlying value of their policy.”
The payouts will increase the underlying value of policies by 23.1pc. Royal London said this translates into an average increase of just over €900, which is based on an average eligible policy value of €4,000.
Some policies are under €100, but others are more than €100,000. The impact for policyholders will vary depending on the size and type of policy they hold. Royal London stressed that what it called the “uplift” is not a cash payment. It will add to the value of the individual’s policy and they will benefit when the policy is claimed.
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