Aviva has been able to reduce the number of Friends Provident customers that might have received unsuitable advice relating to defined benefit transfers to 2,300 clients, it has said.
According to Lindsey Rix, Aviva’s managing director of savings and retirement, the previous estimate of 4,000 individuals was reduced following "really detailed investigations into very complex individual cases".
The issue relates to historic advice given between 1994 and 2002 and Aviva is in the final stages of completing a thorough and detailed review of the matter.
However it admitted the process was taking longer than expected and while Aviva has contacted a significant proportion of the affected clients, not all of them have been made aware they might be affected at this point.
Friends Provident was a life company that became part of Friends Life, which was then bought by Aviva in 2015.
Ms Rix said: "We have to gather significant amounts of information in order to be able to calculate the appropriate numbers for each individual client, which as we worked through that investigation over the course of the year, has clearly needed us to take further reserves on our accounts."
According to the provider’s preliminary annual results, published yesterday (March 7), Aviva has set aside a further £175m to compensate these customers, raising the total provision for this matter to £250m.
Ms Rix added: "Much of this is about communicating with those individual customers and being able to obtain the necessary permissions and then information from those customers, so it really is a case by case basis.
"But we have a plan where we hope to complete all the work on this over the course of 2019, but clearly that is dependent on engagement with individual customers and the time taken on that."
Ms Rix believes the reserves set aside for compensation "are prudently appropriate" but these might be adjusted in the future since as each case goes through the provider has to make individual calculations for the customers.
maria.espadinha@ft.com
