The majority of people who have a with-profits policy with the group will receive free shares in exchange for giving up their membership of the company.
Standard Life has said it is too early to know what these windfalls will be worth, but analysts have estimated the figure will be between £500 and £1,000 depending on how long people have held their policy.
By giving up their membership in the company, with-profits policyholders will no longer have the right to vote at annual general meetings, unless they retain their shares, as the company will be owned by its shareholders.
They will also no longer be entitled to so-called benefits of mutuality payments, although in practice the company no longer pays these following the introduction of a new reporting regime and a decline in its with-profits fund.
A number of members will not receive free shares and they will instead be given cash or policy enhancements.
The group said these members tended to be people who were part of an occupational scheme, or those who lived in countries where there were only a handful of members and it was simply too expensive or not practical to give them shares.
Standard Life intends to amend its regulations to enable people whose polices mature on October 18 or between then and the date of the Special General Meeting to qualify for free shares, and this issue will also be put to the vote at the SGM.
But people whose policies mature before this date will not be eligible to receive windfalls.
Policyholders who took out a with-profits investment on or after March 31, 2004, when the group first announced it planned to go ahead with a demutualisation, will also not receive shares, as the majority signed declarations waiving their right to vote on the proposals and receive compensation for their loss of membership.
The group is due to begin writing to members who are eligible to vote tomorrow, confirming their contact and policy details.
Voting packs will be sent out early next year, with an SGM due to be held in May or June.
Standard Life, which is expected to be worth between £4 billion and £6 billion when it lists next summer, first signalled its intention to float in March 2004.
At that point new Standard members were asked to sign a waiver ruling them out of any windfall should the company pursue a demutualisation.
The board of Standard confirmed its backing for the listing move today, banishing fears that ongoing regulatory talks with the Financial Services Authority may cause the process to be put back.
Standard will write to all eligible members before the end of October to ask them to confirm their policy and contact details.
Chairman Sir Brian Stewart said: "The board continues to believe that demutualisation and flotation is the best way forward and in the best interests of members, customers and the company.
"We expect to put proposals to members ahead of a special general meeting next May or June."
Standard said demutualisation was necessary as there were increasing risks to its with profits policyholders if the company remained as a mutual.
In a mutual business, with-profits investors take on the business risks and rewards of the group. But with the risks being borne by progressively fewer people, Standard said the benefit of a plc means the responsibility lies more with shareholders and reduces the pressure on policyholders.
A flotation should also give Standard access to external equity which would not be available to it as a mutual.
Standard reversed its long-standing opposition to demutualisation after discussions with the FSA over its solvency position.
Since then it has worked to re-position its business as it prepares for a stock market listing. This has included cutting more than 2,000 jobs and the replacement of its direct sales force.
Sir Brian added today: "There remains a lot of work to be done before our proposals can be put before members, but I believe Standard Life has an exciting and successful future."
The company is one of the largest financial services groups in the UK with funds under management of £117 billion at the end of June. It has seven million customers, including the 2.4 million eligible members.
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