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Axa plan may start wave of orphan fund payouts

Plans by Axa to pay former Axa Equity & Law with-profits policyholders £400 windfalls from orphan assets could herald a wave of payouts by life offices.

Both CGNU and Prudential confirm they are considering following Axa&#39s lead.

Research by Schroder estimates life offices have around £44bn in orphan assets. This flies in the face of the commonly touted industry figure of £10bn-£20bn.

CGNU public relations manager Fran Elliott says: “We are carefully considering if a similar arrangement is possible here.”

Prudential media relations manager Jennie Campbell says: “We are in discussions with the FSA on the various options for attributing the estate which is worth between £7bn and £9bn.”

Around 660,000 Axa E&L policyholders could opt for windfalls this autumn by voting to transfer funds from Axa Equity & Law to Axa Sun Life. This would mean relinquishing future bonuses for the £400, meaning Axa would be strengthened by treating the remaining funds as its own.

Axa group chief executive Mark Wood says: “It wouldbe difficult for others to take this model and copy it. Each set of circumstances has tobe looked at separately.”


LibDems offer compulsory alternative to stakeholder

The Liberal Democrats have issued a discussion paper outlining their proposals for an alternative to stakeholder.The scheme, called Owned Second Pension Account, would include full concurrency, compulsion both on employees and employers to contribute to the account and freedom for individuals to choose a provider.It would be run by the private sector but regulated by […]

Summertime – and the consulting is far from easy

It is summer and there is a definite temptation to allow a touch of frivolity to creep into this column.For example, I have invented a new pastime called the Management Consultants Game in which you try to string as many consecutive nouns together in a manner which can still make sense (as defined by a […]

Treasury doesn&#39t know the meaning of a mortgage

The Treasury is delaying the implementation of mortgage regulation until the end of next year because it has not defined what a mortgage is.The Council of Mortgage Lenders is not expecting to see a final blueprint of the regulations until at least November, so regulation will not come into force until the end of next […]

Julian Gibbs

Very few investors are taking advantage of their capital gains tax allowance.Those investors lucky enough to have invested early in technology funds can, of course, sell sufficient units each year to use up at least part of their allowance but the majority of investors do not wish to put their money in such a high-risk […]

When is £1m not £1m?

Neil Jones is technical support manager with Canada Life’s ican Technical Services Team. Canada Life offers a range of wealth management solutions, including retirement income planning, estate planning and investment solutions from a choice of jurisdictions, including the UK, Isle of Man and Republic of Ireland. The residential nil-rate band (RNRB) was first announced in […]


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