Aviva becomes first pensions & insurance provider to join Dormant Assets Scheme
Melanie May | 5 June 2023 | News
Aviva has become the first insurance and pensions firm to join the Dormant Assets Scheme as it expands to include the sector.
The first transfer of dormant assets from the insurance and pensions sector has taken place, completed by Aviva and Reclaim Fund Ltd (RFL), the HM Treasury-owned and FCA-regulated operator of the scheme. This sees Aviva join over 40 participating UK banks and building societies.
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Kirsty Cooper, Group General Counsel and Company Secretary, Aviva plc commented:
“We have been working proactively with RFL and the wider dormant assets community for a number of years to expand the hugely successful Dormant Assets Scheme to the Insurance and Pensions sector and adapt it for longer-term products.
“It is great to see the culmination of a lot of hard work reaching fruition and it is such a privilege to be the first participant in our sector. We have been involved with the Dormant Assets Scheme since 2016 and hope that Aviva’s participation will encourage other companies to take part, with the dual purpose of reuniting customers with their assets while also ensuring dormant assets can have a positive impact on our society.”
Aviva has worked with government, industry and RFL for over six years to adapt the model to new sectors and additional financial assets, culminating in the Dormant Assets Act 2022.
This has also been supported by the Association of British Insurers (ABI), which has developed new resources to help companies prepare to join the scheme, which is voluntary and requires participants to show that they take extensive efforts to trace the original owners of dormant assets to try and reunite them with their funds.
Hannah Gurga, Director General, ABI, commented:
“This expansion unleashes our sector’s potential to use the millions of pounds it has in unclaimed assets to support good causes, with customers being able to reclaim their money indefinitely. We’re delighted that years of work with Government, Reclaim Fund Ltd and industry has come to fruition and to see the first transfer successfully completed. We hope that other insurers and pension providers will follow and have launched a new Participation Guide for those who are interested in joining the Scheme.”
Since the Dormant Assets Scheme was established in 2011, more than £1.6bn in dormant assets has been transferred to RFL. From this, almost £900mn has been distributed to over 2,500 social, community and environmental initiatives across the UK.
Where next
Having opened up to insurance and pensions, the scheme will next open to assets in the investments and wealth management sector, along with securities or shares in UK plcs over the coming months. Conservative estimates suggest that expansion can potentially unlock a further £880mn for good causes.
Adrian Smith, OBE, Chief Executive, Reclaim Fund Ltd, said:
“The Dormant Assets Scheme has a clear purpose and a unique role in uniting public, private and third sectors to deliver a demonstrable, positive impact in our most vulnerable communities.
“We are delighted to open the Scheme to financial institutions with dormant insurance and pensions assets enabling them to participate alongside established banks and building societies. The Scheme is straightforward to join, tightly regulated and carefully managed so customers can trust in the lifelong promise that they can reclaim any dormant assets at any point in time.”
Dormant assets funding distribution
Dormant assets funding is distributed through the National Lottery Community Fund across the UK in line with policy direction from the Government and devolved administrations.
In England, dormant assets funding is used to support financial inclusion, youth and social investment through four dormant assets spend organisations: Big Society Capital; Access – the Foundation for Social Investment, Fair4All Finance and Youth Futures Foundation. In March 2023, following a public consultation, the Government announced that funding for these causes would continue, alongside a new cause: community wealth funds.
The Economic Secretary to the Treasury, Andrew Griffith commented:
“This is a significant moment for the Dormant Assets Scheme and an important reminder of the Financial Services sector’s vital role in driving economic growth and supporting communities and citizens across the UK.
“I look forward to working with Aviva and other industry participants as the Scheme opens up to additional asset classes throughout the year, unlocking millions of pounds for good causes across the country.”
About Melanie May
Melanie May is a journalist and copywriter specialising in writing both for and about the charity and marketing services sectors since 2001. She can be reached via thepurplepim.com.