"We do not recommend having a punt on this," a spokeswoman said. "Our products are long-term financial commitments. We are trying to meet peoples' needs and provide security for their financial future."
Up to 2.5 million existing policyholders stand to gain from a cash bonanza that could be up to pounds 1,000 each if they agree to abandon mutual status by 1997.
Those set to gain are Norwich's 2 million with-profits life policy holders - investors in endowments and pensions - as well as some unit-linked savers. Those holding only what are termed general insurance policies - car or medical, for example - will not qualify.
Although no cut-off point has been announced for when new policyholders would be denied a share in any flotation, and although no freeze has been put on purchases of new plans, the insurer's warning is bound to dampen speculation that people who take out policies now will still qualify for any windfall.
Norwich also rejected suggestions that in announcing plans to de-mutualise or become a publicly quoted company it was attempting to drum up new business, which has suffered from the bad publicity about mis-selling of personal pensions.
At least one Australian mutual society seeking to convert has held out the prospect of windfall bonuses for consumers who took out new policies before a stated deadline. But Norwich's coyness may well reflect a desire to keep on the right side of its regulator after being fined pounds 300,000 and being forced to recall 800 sales staff back to the classroom for re- training last year.
The terms of any payout have yet to be decided, and no decision is expected until well into next year. Policyholders could get free shares - which occurred when Abbey National chose to convert in 1989. Or they might receive bonuses, either as a one-off cash sum or added to existing policies - as happened with Provident Mutual, which is currently the subject of a bid from General Accident.
Rapid consolidation in the financial services sector has seen millions of building society customers benefit from cash incentives to secure agreement to a change of ownership structure. Already this year, Lloyds Bank's takeover of Cheltenham & Gloucester has yielded average payouts of pounds 2,200 for the vast majority of the society's savers.
Stockbroker UBS estimates that windfalls from other building societies seeking to become banks or to merge could average between pounds 390 and pounds 740. Qualifying savers with the National & Provincial building society will learn tomorrow that they will receive bonuses of at least pounds 500 each following Abbey National's pounds 1.3bn takeover.
Mutual life insurers, like building societies, are owned by their customers - called members - and many analysts believe the sector is similarly overdue for restructuring.
However, experts warn against becoming a member of a mutual insurer simply in the hope of a bonus. Whereas savers with as little as pounds 100 in a building society account have benefited from bonuses of pounds 500, bonuses to life insurance or pension policyholders are likely to be less important in relation to the value of a policy. People who take out policies speculatively may find they have let themselves in for a large commitment in return for a small windfall.
In addition, any windfalls might not be so easily accessible - instead of being paid out directly to policyholders many are likely to be paid in the form of bonuses to a policy's value. It may not be cost effective or permissible to realise the value of those bonuses for some time.Reuse content