More (draft or has it been submitted?) crookedness from Aviva and pals at Linklaters?

agarnett

I do not wish to directly engage with the detail of the rant, except to say that i have intimate knowledge of the reattribution process run by Aviva, and both Aviva and Friends Life With Profits operation.
It is a very technical area, and subject to a great deal of internal and external scrutiny.
The whole "With Profits" market is indeed shrinking, as the cost of operation and lack of transparency about the process make it relatively expensive and risky for the companies to operate.


The reattribution process has been a little controversial; in simple terms the WP funds have built up a surplus over the hundreds of years they have been in operation. Aviva wanted to clear down this surplus by the process of reattribution, whereby policyholders would be given 90% of the surplus and the company would get the 10%. This was a voluntary scheme, in that policyholders were not forced to give up their rights to the "inherited estate".
An independent person, Claire Spottiswoode, was appointed as a Policyholder Advocate and was pretty robust in ensuring the interests of the policyholders were firmly upheld


The current high court process is a "Part VII transfer", whereby different WP funds are generally merged or otherwise combined to ease administration. It's a lengthy process and laboriously technical, hence the high court and 200+ page arcane document to ensure PH interests are fully met.


I am no apologist for Aviva - it has a lot of challenges - but in my view the culture, governance and operation over their WP is pretty sound and there are sufficient avenues of redress (complaints, FOS escalation, policyholder advocate process) to answer concerns.


I will not be commenting further and stoking any debate, as I do not feel it will be productive.

Well well well gentlemen, and you, ex-pat scot

So who rattled your cages?

Yes the court approvals sought are presented as Part VII transfers. Part VII ought to be the eye of a needle through which camels cannot pass, but they seemingly do now, habitually. and one of the worst aspects about it is the extremely low priority placed on notifying policyholders of what is going on. And the regulators are in cohorts with the corporates in letting the poor darlings avoid expense of notifying policyholders. Read this for example: http://www.lexology.com/library/detail.aspx?g=620f2af6-ffaa-44a3-835f-5238a3dd63f7.


The With-Profits "market" may be shrinking Mr or Mrs ex-pat Scot, but the multi-tens of billion pound funds are certainly not. Why else would it be attracting so much internal corporate scrutiny :rotfl:

I can read these documents thanks very much, but it is hard work because I am not party to the exact motives of those that drafted them, and nor will the judge at the High Court ever be confided in and made party to those motives. When a murder is committed, motive is the first thing that is established in judging why a party did it. Is it a crime of passion? Or one of blatant greed?

I commented !!!!!! when I stumbled upon the latest document because when I bought my pension policies - actual printed insurance company plans running to a few tens of pages, I was not signing up to some bloody Readers Digest type book club churning out reams of self-serving cr¤p. I don't want to have to read 200 page plus jargon and brand new acronym filled documents on a flippin' regular basis in order to understand how the provider is constantly attempting to loosen my grip on my own investments and constantly completely rearranging their business and renaming everything and referring to multiple shrapnel pieces as six letter acronyms, just to suit their shareholders profits.

I know how to read complex documents including complex insurance and legal documents. I would guess that 999 people out of a thousand have no idea even how to begin on a good day.

When such a document appears but is not expected, motive is where the reader needs to begin. No-one wants to start reading 200 pages of anything without understanding first where the author is coming from, or how a reading of the work is likely to benefit the reader either as entertainment or as an interesting development affecting the reader's affairs. False motives need to be cleared away. Actual motive needs to be understood.

That is why I asked dunstonh (in vain) for an abstract for the benefit of MSE'ers.

It is however clear that those that create these documents have no intention of disclosing their secret plans - they are designed merely to bamboozle the readers of the documents, particularly regulators and the judiciary, and to flatter them that they know what they are judging.

My view consequent upon spending hours dipping into these reams and reams is that any suggestion of internal scrutiny for the benefit of policyholder interests is a complete sham when it comes to managing W-P at Friends Life and Aviva.


It would be quite amusing reading the mealy-mouthed language of actuaries making declarations about fairness to policyholders if it wasn't so serious that their word is so easily taken as gospel, even by high court judges. Do actuaries take an oath not to harm anyone like doctors used to? I think not. They are all employed solely for shareholder profit motive, and worse than that, birds of a feather flock together, so even if an "expert" is offering opinion on another's highly paid work, chances are the interests are conflicted. I mean look at the number of non-executive directorships collected by that individual whom we read apparently retired at age 50. He puts even political operators like George Osborne to shame!

So why is their opinion even allowed as "expert" opinion in a court of law? Isn't the experience of the last 15 or 20 years clear evidence that judges have no idea of the world of insurance with-profits funds? First we had the w-p house-purchase endowment shortfall fiasco with no-one properly having any drains up to see what really caused it, scaring the sheeple prematurely into making their own fresh repayment arrangements, and then speculators like Resolution moved in to garner the spoils (yes of course their lot are behind much of the art of the Part VII transfer wheeze aren't they?). I had intimate knowledge of some of the endowments they took over in 2004 when they started! I hammered the table at RSA extremely hard and secured compensation for pre-1987 endowments. Didn't everybody? No of course not, because the industry closed ranks and set arbitrary limitations on how far back endowment "misselling" claims could be prosecuted. It wasn't misselling of course. It was something quite different occurring at board level. Look at who the key people were at Resolution plc according to that Wikipedia page I just linked to.

Then we had the Treasury Select Committee trying their best to make a fist of some sort of formal external scrutiny of W-P in 2007/8 because FSA weren't up to it, and that ended up with Aviva effectively giving the committee two fingers and proceeding with w-p reattribution regardless of the committee's concerns, and those of Clare Spottiswoode you mention, who had totally inadequate access and resources to be able to do the robust independent job you imply she did. I met her before it was resolved and before she moved into Gas Energy and all that. Did you?

Then we had the FSA>FCA's Clive Adamson supposed faux pas where we learned that the major UK life and pensions companies were going to be subject to some real tough drains up activity, but then the industry complained of FSA's lack of nouse in managing their PR fall out, and started making noises about FSA being responsible for shareholder losses when the insurer shareprices took a massive dip! And the drains inspection got terminally postponed ...

The conflict of interest issues featuring in UK Financial Services and in government and regulation of Financial Services remain absolutely astounding to this day.

And ex-pat scot, you may have dipped out of the debate, but your description of Aviva's supposed clearing down motive of 90:10 distribution of inherited estate is disgracefully misleading if you have any continuing position in the industry which would ostensibly require you to treat customers fairly. Your description of what reattribution is or was, is completely wrong.

Ownership of the rights to distributions from inherited estate was already attributed in law 90% to the policyholders. Re-attribution was the word dreamed up by the actuaries indulging in the wheeze to bribe policyholders to give up their right thus giving it 100% to shareholders.

Some 87% of Aviva policyholders were persuaded to take the bribe. I was one of the 13% who had seen it all before. Who were you?

bowlhead99

agarnett wrote: »

Well well well gentlemen, and you, ex-pat scot

So who rattled your cages?

If you read the responses, you'll see people are trying to help you by explaining some things. However, as you are already content that you know it all without any input from others, it is a thankless task.

Sorry, I mis-spoke. You seem to not know it all because you are irate that you have not been informed and that the short-form explanations hosted on the website on what is happening are presumably not good enough for you because you believe they are lies or won't give enough detail for you as an expert reader. But the long legal agreement between the entities which articulates the current process in great detail is too much information for you and dismissed as reams of crap.

Part of the complaint is, it seems, due to their practice of referring in legal documents to certain entities or sub-funds by five- or six-letter acronyms which they have defined up front to avoid needing it write it out in full and taking hundreds of extra pages; but you don't like that because you'd have to keep looking at the definitions pages to remind yourself which one is which. That is a stupid complaint.

But bringing stupid trivialities like that into your wider complaint is an example of the issue to which I referred in my earlier post - you might have something sensible to say but you obscure the central tenet of your point by coming across as a crackpot who will say absolutely anything to find fault with an organisation he does not like (however misguided or trivial, such as the use of defined acronyms within something drafted by a law firm).

So on the one hand you say they are not making it clear to you and are writing self-serving documents (yes, they serve themselves in bringing the business under one umbrella rather than maintaining the old legacy umbrellas - and there is nothing fundamentally wrong with striving to be efficient by merging entities). You said you have not been told what is happening and that you came across the document by accident on the IFA site while looking for something else.

And then after I point you to the lengthy FAQs and document library on the main consumer site, you seem to imply that of course you know all about what is going on having previously met an independent advocate who didn't have the right resources to be independent or well informed etc. No doubt you think the current independent expert's report is not worth the paper it's written on because it's signed by a fellow from Ernst & Young which is a firm that makes its money by providing professional services to financial firms (among other types of firms) so he is clearly getting paid for his expertise so he is probably bent.

I know how to read complex documents including complex insurance and legal documents. I would guess that 999 people out of a thousand have no idea even how to begin on a good day.

Good then that they are not required to understand every term contained within a Part VII transfer, so they do not need an idea how to begin ; Aviva are not employing the policyholders to draft the internal business documentation or any legal agreements between the various Aviva and legacy FL entities. They could just read the consumer literature produced and get some independent advice on it if/when they are unsure. There are a variety of protections for policy holders, which do not presume the policy holders to be experts.

I don't know that I'll stick around to see how many topics and points of history relating to other firms or individuals you can bring in to your next 1200-word response but I hope you are enjoying yourself. It must be fun to get so angry and win the admiration of your peers by venting on here. I have no wish to meet such peers.
:beer:

dunstonh

Bowlhead, don't waste your energy. Most of the regulars in this section have him on their ignore list. I suggest you do the same and save your detailed and helpful responses for people that deserve it.

steampowered

I read part of it. I don't agree that it is written in legalese. It looks to be written in clear English. It is simply long and detailed.

There is no reason why the Op couldn't read through it, if the Op were so inclined.

The document is about insurers transferring an insurance business from one company to another within the Aviva group. It looks to be an internal business restructuring exercise. I doubt any of that is of interest to policyholders, as it shouldn't affect policy terms.

agarnett

Avivas_First_White_Bloodcell_To_the_Site_Of_Every_Whiff_Of_Scandal wrote:

Bowlhead, don't waste your energy. Most of the regulars in this section have him on their ignore list. I suggest you do the same and save your detailed and helpful responses for people that deserve it.

Yeah, some see this forum as their club. They sit in the comfy carvers at the head of the table, and the little people who aren't regulars are allowed to visit the table with their FAQs. Step outside the bounds of FAQs into something more edgy and you'll learn that's not cricket old boy.

We don't need to massage the egos of "the regulars" on MSE. They either offer useful comment or they don't. We can take it or leave it and so can they. I was reading recently in another thread, an IFA who was looking to narrow down his customer base as he had rather a lot, and some types were proving more work than others. Nice.

steam-powered wrote:

I read part of it. I don't agree that it is written in legalese. It looks to be written in clear English. It is simply long and detailed.

There is no reason why the Op couldn't read through it, if the Op were so inclined.

The document is about insurers transferring an insurance business from one company to another within the Aviva group. It looks to be an internal business restructuring exercise. I doubt any of that is of interest to policyholders, as it shouldn't affect policy terms.

Oh really? What's inherited estate? What's treating customers fairly, what's final bonus, what's non-profit policies in a w-p fund? What's regular bonus? What's reorganisation bonus?
What's reversionary bonus? What is reattribution? What's your Solvency Risk Appetite? What reinsurances are being taken on by these funds? Are they w-p or non-profit. What is the purpose of them? What's the RBM Account and what sort of circumstances might make it non-zero? And just to show how silly your "plain English" claim is, what the hell does this clause mean:

63.3.6 in the case of the Old WPSF, the New WPSF and the UKLAP WPSF (each an “Existing UKLAP Closing Fund”), distribute such surplus (calculated taking into account the guarantees and benefit expectations that policyholders would be
entitled to immediately prior to the closure of the Existing UKLAP Closing Fund), in such manner as it shall determine, consistent with the principles generally applying to such Existing UKLAP Closing Fund immediately prior to the UKLAP Fund Closure Date and taking account of:
(i) UKLAP’s regulatory duty to treat customers fairly;
(ii) policyholders’ reasonable benefit expectations; and
(iii) UKLAP’s view of expected future investment returns and the cost of providing capital,
to the holders of Policies allocated to such Existing UKLAP Closing Fund immediately prior to the UKLAP Fund Closure Date and thereupon any assets remaining then allocated to the Existing UKLAP Closing Fund and liabilities relative to such assets or to Policies allocated to the Existing UKLAP Closing Fund shall be
allocated to the NPSF (or to such other Non-Profit Sub-Fund as the UKLAP Board may determine) and such Policies shall cease to carry any further right to participate in profits of UKLAP arising after the UKLAP Fund Closure Date.

Let me give you a clue to its actual readability - its a single bloody sentence AND it contains a circular definition - see if you can spot it ...

You are evidently either rather gullible or you are more than steam-powered - perhaps you have some other auto-motive tendency toward a particular view. You are however simply very wrong with your last sentence. This "transfer" scheme is much more than just "a transfer". It is bvggering about (again) with policyholder expectation (which itself appears as a bloody acronym now) and it is bvggering about with entitlement to future bonuses and distributions of inherited estate and it is bvggering about with entitlements to allocate costs to our funds and thus reduce bonuses and distributions, and it makes judgements unto itself about what is fair and what isn't.

bowlhead99 wrote:

If you read the responses, you'll see people are trying to help you by explaining some things. However, as you are already content that you know it all without any input from others, it is a thankless task.

Er... pardon? Who came here to help? You possibly may have thought I was unaware of some of the other material so you linked to it which is helpful, but it is not helpful that you should also judge my reaction to these changes as misguided because the legalese I complain about is no worse than Tesco supply chain contracts. How is that a reasonable analogy? I am not investing in long life baked beans with a known risk of BPA seepage into the sauce, or an unbounded botulism risk that goes back to the days Tesco took over someone else's warehouse stock as part of a takeover deal. I am investing in a pension which should be doing what it said on the 30 year old can, not what people like Andy Briggs fancy substituting in its place when they feel like it and without reference to me.

You aren't helping customers - you are defending big corporates right to use gobbledegook to stitch up customers.

Kynthia

agarnett wrote: »

I see the old guard have been out in farce

There's our "old book" Aviva lead apologist, dunstonh, and there's dear old mgdavid who still fancies him or herself as something in financial services too, but looks to be out of it.

Get over yourselves ladies.

Please don't use the word "ladies" as an insult. It's offensive in the same way using the word "gay" to mean something dislikeable is.

agarnett

Sorry Kynthia - typo. Fixed just for you.

Anything you wish to comment on, on topic?

steampowered

agarnett wrote: »

Oh really? What's inherited estate? What's treating customers fairly, what's final bonus, what's non-profit policies in a w-p fund? What's regular bonus? What's reorganisation bonus? What's reversionary bonus? What is reattribution? What's your Solvency Risk Appetite? What reinsurances are being taken on by these funds? Are they w-p or non-profit. What is the purpose of them? What's the RBM Account and what sort of circumstances might make it non-zero?

These are all concepts which you could quite easily google. If you want to know what the abbreviations or definitions are, read the definitions at the front. Simply because it is complicated does not mean it isn't written in plain English.

And just to show how silly your "plain English" claim is, what the hell does this clause mean:

63.3.6 in the case of the Old WPSF, the New WPSF and the UKLAP WPSF (each an “Existing UKLAP Closing Fund”), distribute such surplus (calculated taking into account the guarantees and benefit expectations that policyholders would be entitled to immediately prior to the closure of the Existing UKLAP Closing Fund), in such manner as it shall determine, consistent with the principles generally applying to such Existing UKLAP Closing Fund immediately prior to the UKLAP Fund Closure Date and taking account of:
(i) UKLAP’s regulatory duty to treat customers fairly;
(ii) policyholders’ reasonable benefit expectations; and
(iii) UKLAP’s view of expected future investment returns and the cost of providing capital,
to the holders of Policies allocated to such Existing UKLAP Closing Fund immediately prior to the UKLAP Fund Closure Date and thereupon any assets remaining then allocated to the Existing UKLAP Closing Fund and liabilities relative to such assets or to Policies allocated to the Existing UKLAP Closing Fund shall be
allocated to the NPSF (or to such other Non-Profit Sub-Fund as the UKLAP Board may determine) and such Policies shall cease to carry any further right to participate in profits of UKLAP arising after the UKLAP Fund Closure Date.

Let me give you a clue to its actual readability - its a single bloody sentence AND it contains a circular definition - see if you can spot it ...

That's all perfectly readable and completely clear to me. Simply look up what the definitions mean as as you go.

This "transfer" scheme is much more than just "a transfer". It is bvggering about (again) with policyholder expectation (which itself appears as a bloody acronym now) and it is bvggering about with entitlement to future bonuses and distributions of inherited estate and it is bvggering about with entitlements to allocate costs to our funds and thus reduce bonuses and distributions, and it makes judgements unto itself about what is fair and what isn't.

Yet you seem unable to explain how any of this affects policyholders.

agarnett

You write somewhat precociously, steam-powered, and methinks there's a strong possibility there's a ways for you to go before you will be able to debate these concepts. Are you just starting out?


But hey, if you think you can make sense of it. You can google anything but you have to have more knowledge than that to know whether what you find is true, in context and irrevocably defined.

So for the benefit of Aviva Life & Pensions W-P policyholders in the various sub-funds within the Aviva UKLAP who hadn't yet appreciated they might be in any fund that might be closing any time soon, please explain clearly what clause 63.3.6 means for them. Clear actions and effects would be good to know. Dates would be good to know. Ideas of typical pre-existing guarantees and benefit expectations would be good to know. Likely TCF challenges faced by Aviva in their endeavour would be useful to understand. Oh and since they allude to reasonableness, examples of unreasonable policyholder benefit expectations might be good to know. Some detail about what the Non-Profit Sub Fund exists for would be good to know, especially since we are talking about With-Profits Funds. What profits from UKLAP are anticipated after Fund Closure Date?

By the way, as a long term policyholder invested in the same W-P Fund, no-one has told me my fund is closing.

So what can you tell us please whilst it is so clear in your mind?

ex-pat_scot

This thread is my guilty pleasure.