Abbey National has begun writing to the 450,00 former members of The Scottish Provident Institution,...
Abbey National has begun writing to the 450,00 former members of The Scottish Provident Institution, advising them of the amount of compensation they will receive in return for giving up membership of the former mutual.
The total amount of compensation payable stands at £1.8bn, £1.6bn as compensation to qualifying members and £0.2bn to the with profits fund. All qualifying members will receive a fixed amount of £500.
Those with qualifying with profits policies will also get variable compensation linked to the type of policy held and length of holding.
The average payout will be £4,000, and will be paid by the first quarter of 2002.
David Woods, the former group managing director at Scottish Provident Protect and now executive director of Abbey National's life assurance business, said: 'The decision to become part of Abbey National was the right one for all of Scottish Provident's policyholders.'
Former members who do not want to be paid by cheque have until 28 January 2002 to tell Abbey National if they want to receive it as loan notes, to avoid capital gains liabilities, or have it paid into an Abbey National account. Details of the options are contained in the personalised letters sent to them.
Graham Pottinger, managing director of Abbey National's life assurance business, said: 'Abbey has ambitious growth plans for the Scottish Provident business in Britain, Ireland and the Isle of Man within its bigger life division. The backing of a strong parent will deliver real benefits for all Scottish Provident policyholders.'
Abbey National has opened an account to make payments to any members who have not been identified or those who Scottish Provident has been unable to trace.
