by Structured Settlement Watchdog®
Aviva continues to defend itself in the Class Action law suit brought by Hawaii resident John Griffiths as lead plaintiff, over Aviva’s unannounced unilateral termination of the Capital Maintenance Agreement (CMA) in 2013.
The Aviva Capital Maintenance Agreement was an instrument that was:
- used by Aviva’s USA operations in its agent and consumer facing market materials;
- marketed as a security feature
- a feature that Aviva London charged extra money for on each contract that had it.
All of which directly helped Aviva to generate over $1 billion of annuity premium for its US subsidiary from structured settlement in the USA, through the end of 2008.
For a Defendants perspective, consider reading the Memornadum of Law submitted by Defendants
Download CGU Aviva International Insurance plc Memorandum of Law While some may perceive it as skilled lawyering, in reality, it presents a compelling argument as to why Aviva may not be a company for agents or consumers in the future.
Given the opportunity to make things right when the unilateral unannounced termination of the CMA took place, Aviva did nothing for its customers
Consider that Richard J. Kypta, then Senior Vice President of Aviva Life Insurance Company, even went so far as to put in writing on Aviva company letterhead, dated May 20, 2004, that the Capital Maintenance Agreement “was one two forms of guarantee“. expressly stated in writing that it “absolute, unconditional, and continuing” and explicitly authorized this information to be used in an affidavit to a Court in Erie County New York that was deliberating on the approval of a settlement.
Fortunately the Athene successor entities have improved financially in the eyes of the A.M. Best rating agency since the acquisition by Athene concluded in October 2013.
Download Sample Aviva CMA letter delivered with annuity contract 2006
Aviva Produced Marketing Materials circa 2005
The Aviva CMA placed heavy emphasis on a company that had “roots dating back to 1696“
“Under the CMA, CGU International Insurance plc (CGUII) ensures that Aviva London Assignment Corporation will have the funds necessary to satisfy all structured settlement obligations assigned
to it, regardless of the financial position of the life company from which the “assigned” annuities
are purchased. This obligation is absolute, unconditional and continuing!”
The actual agreement between CGU and Aviva International was withheld from agents and consumers and must be disclosed to reveal any discrepancies between the actual agreement and the misleading information Aviva provided to its agents and customers, as was suggested by Aviva’s subsequent actions
It’s natural to expect Aviva to put up a big fight on that one. It took two months for Athene to provide a straight answer when I questioned them about the CMA in September October 2014.