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Fury at ScotLife blocking bonus

IFAs have slammed Scottish Life for reneging on its pledge to issue

with-profits policyholders with an additional reversionary bonus

following its demutualisation last year.

ScotLife sent out a policy circular last April stating its intention

to pay a bonus to policyholders at the end of 2001 as part of a

compensation package for loss of voting rights after the takeover by

Royal London.

But chief executive Brian Duffin has admitted that ScotLife has

decided not to pay the ARB as it may result in poorer returns for

policyholders in its closed fund.

IFAs are furious with the move, saying it is tantamount to robbing

members who were in line to receive payouts averaging £650 per

policy. They claim the matter should be investigated by the FSA and

say it is another blow to an industry which has been hampered by a

poor public image.

JWP Life & Pensions principal Stephan Reynolds says: “They are

just robbing their customers. They have made a promise to make a

payment and they have not. It should be investigated by the

regulator.”

Pensions & Investments Management principal Phil Moore says: “It

is outrageous. I am dumbfounded that a multi-billion-pound company

can turn round and do this to policyholders. It is not good news for

the industry.”

Scottish Life head of communications Alasdair Buchanan says: “There

was always a possibility that financial and economic conditions would

change the committee&#39s view as to whether a bonus would be paid or

not.”

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