Funeral insurance and crematoria cooperative Dela has pulled the plug on its planned takeover of sector peer Yarden, which was announced a year ago.
Dela says it has ditched the deal because of the years of financial uncertainty facing Yarden, which has been forced to dig deep into its reserves after running into trouble with a portfolio of old policies.
‘We were convinced that the takeover would have been good for everyone,’ Dela director Edzo Doeve said. ‘But as a non-profit cooperative, we have to put the interests of our members first. And that is what we are doing, because the uncertainties facing Yarden are not in their interests.’
Yarden had been looking for a partner for some time. The troublesome portfolio is made up of ‘natura’ policies, which guarantee to provide a complete funeral, including coffin, car and cake, rather than a fixed amount of money.
Yarden said the policies no longer covered the cost and had tried to change the terms and conditions, but a group of policyholders went to court and won.
In August Yarden was given the green light to change the conditions of ‘all in’ policies without the agreement of policy holders.
Financial complaints institute Kifid ruled that without the changes the company will not have enough money set aside to pay for its obligations and faced going bust.
The regulator ruled that the change in the conditions is to the benefit of the policyholders, because without it, the company would have gone bankrupt and they would have been left with nothing.
Dela is Dutch market leader, with four million members, and organises some 44,500 funerals a year.