Tuesday 26 May 2020

Aegon agrees new compensation deal for investment policyholders

Insurance giant Aegon has agreed a third compensation package for hundreds of thousands of people who took out investment-based savings policies before 1998.

This time the settlement involves a further recalculation of premiums for life insurance included in the package. Policyholders will get an average €300 to €400 back from Aegon, Nos television says.

The settlement follows a high court ruling which showed Aegon had charged policy-holders far too much for life insurance, leaving little of their payments over to invest.

That ruling was in favour of 30,000 people who had signed up to a special foundation campaigning for a refund. The new payment applies to everyone who had a policy, whether a member of the foundation or not.

1990s

Aegon sold some 1.2 million of the investment policies in the 1990s. It has already paid out some €800m in compensation since legal action by various interest groups and pressure from the financial services sector ombudsman.

Some 6.5 million investment-based policies were sold since the beginning of the 1990s by around 20 different companies. But huge costs attached to some policies means very little of the actual premium was invested. They became collectively known as ‘woekerpolissen’ or ‘rip-off policies’.

In 2008, the financial services sector ombudsman said that policy-holders faced with costs amounting to more than 3.5% of their total premium should get financial compensation.

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