Norwich Union (NU) is expected to pay out billions to its policyholders if parent company Aviva decides to share out the company's 'orphan assets'.
The unallocated assets have accumulated to £3bn in two of its with-profit funds, CGNU Life and Commercial Union Life Assurance Company.
Policyholders could expect windfall payments in 2008 of up to £3,000, but it is more likely to be a few hundred if the total is also distributed among shareholders.
At this stage, no decision has been taken to proceed with reattribution, which will only take place if there is agreement on a fair outcome for policyholders and shareholders, according to the insurer. This will include agreement by the independent policyholder advocate and Aviva on any incentive payments to eligible with-profits policyholders.
Clare Spottiswoode, former gas industry regulator, has been appointed as policyholder advocate.