Standard Life Rejects Fund Call
Standard Life has rejected a call to use £100M a year from its profits to fund a programme to cover the firm's endowment policy "black hole".
The call to build up a fund to cover the shortfalls of with-profits mortgage endowments, came at the company's annual general meeting in Edinburgh last week.
Alastair McClelland, a Standard Life shareholder, used the AGM to demand that the company set aside £100m a year over ten years into the firm's "with-profits fund".
Standard Life chairman Gerry Grimstone argued that the problems with with-profits policies were a legacy of the company's mutual past.
In 2000 Standard Life promised that it would meet any shortfall policyholders faced on their endowment policies. However, when the company got into solvency problems, the promise was changed in 2004 to a guarantee of paying only a proportion of shortfalls.