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Insurance firms' shares rally despite City watchdog inquiry

Shares in a number of insurance firms have recovered slightly since tumbling this morning after the City watchdog , the Financial Conduct Authority, announced plans to start an investigation into 30 million policies sold between the 1970s and 2000.

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Aviva expects 'minimal impact' from policy probe

Aviva shares dipped by almost 3% following today's announcement. Credit: Aviva

Britain's largest insurer says it expects to feel "minimal" impact on profits as a result of an investigation into 30 million policies.

Aviva, which has seen its shares close almost 3% lower after the announcement of the probe, says it has already capped charges at 1% or less for pre-2001 group personal pension policies and has no material exit charges applying to its legacy book.

It said the Financial Conduct Authority's review could apply to around £200 million of its long-standing life insurance policies.

However, the firm added its "treatment of customers has been fair and appropriate, and therefore any impact on the group's profits should be minimal, if at all".

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