Aviva promises refunds for 50,000 overcharged customers

Aviva promises refunds for 50,000 overcharged customers

Insurance giant Aviva, which employs 2,500 staff across hubs in Perth and Bishopbriggs, has had to inform 50,000 of its customers that they were overcharged for their premiums and promised to refund them.

The error, which affects holders of index-linked income protection policies, life insurance policies and critical illness policies, is expected to result in a bill that will run to millions of pounds.

Aviva, which said it spotted the error after a random review, says it has written to holders of the affected policies confessing that an “IT error” led them to be overcharged for their policies — often for years.

The policyholders affected are those whose premiums go up in line with the retail prices index (RPI); rises appear to have been miscalculated.

Aviva has not said when the problems started but that those affected were originally customers of Friends Life, an insurer acquired by Aviva in 2015 and they will now be informed of how much they would be repaid.

Aviva said that about 50,000 customers had been affected and that “the vast majority” had overpaid by £100 or less.

If every customer paid £50 too much, the insurance company would owe its customers £2.5 million. If they overpaid by £100, Aviva would owe £5 million.

A spokeswoman for Aviva said: “As part of an ongoing review of our policies, we’ve found a number of our older-style Friends Life customers who have indexed-linked life insurance policies have paid higher premiums than they should have done.

“We’re contacting all affected customers to apologise and are committed to ensuring they are not financially disadvantaged as a result.”

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