Financial services group NN has become the latest to agree a settlement with clients who lost out financially because of the high charges they had to pay on investment-based savings accounts.
NN, the parent company of Nationale-Nederlanden, said on Tuesday it had agreed to pay out €360 million to buy off claims. Last November ASR, which also owns Aegon, agreed on a deal worth some €250 million.
The so-called ‘woekerpolis’ affair was brought to light in 2006 by TV consumer show Radar, following an investigation by the Dutch financial markets regulator AFM. The AFM said hidden costs meant many customers paid more to cover their investments than they earned from them.
Altogether around half a million people took out similar products from various insurers between 1990 and 2008. Clients paid a monthly fee, expecting a
large payout at the end of the period – usually 20 or 30 years – but then
discovered much of their investment had gone on costs, including fees to
NN’s decision to settle follows a class action court case last August in which judges ruled largely in favour of the insurers’ customers. In particular, the appeal court judges said that a large part of the costs paid by NN Group clients were unjustified and has described information provided by Nationale Nederland as “unfair”.
That ruling led to a sharp drop in ASR and NN’s share prices.
Achmea, with brands Avero, Centraal Beheer and Interpolis, is still in talks on a possible settlement.
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