Background information on robbery and restoration

Supervisory Committee on the investigation of WW II financial assets in the Netherlands

In 1997, the Supervisory Committee on the Investigation of WW II Assets, or the ‘Scholten Commission’ for short, named after its chairman W. Scholten, was given the general assignment of ‘carrying out an investigation into the actual systematics regarding the legal redress in respect of the financial assets of Second World War victims with banks and insurance companies in the Netherlands’. The Commission focused on the question of which assets, entitlements to policies and other asset titles of victims or persons duped by the measures from the occupation might still wrongfully rest with banks, insurance companies or the State.

Below follows a summary of the Insurance part of the ‘Scholten Report’, in which the robbery and legal redress of Jewish life insurances, annuities, pensions and funeral insurances in the Netherlands are described. The conclusions and recommendations of the Scholten Commission have also been included, which, among other things, have led to the founding of the Sjoa Foundation (SIVS)

The robbery of Jewish insured assets via Liro
During the Second World War the occupier gets control of the insured values of Jewish policyholders through a series of regulations that had the force of law. In the ‘First Liro Regulation’ 148/1941 of 8 August 1941 the insurance policies are still disregarded as this regulation is focused on bank assets, cash and securities. However, the consequence of this regulation is that some Jews try to safeguard their capital in so-called ‘escape policies’ in which a single premium payment is made to conclude the insurance policy.
Actually, the intention was to give the assets into custody so that these could be returned in better times after deduction of expenses. It also occurred that policies were split into contracts that could not be surrendered individually. Finally, the regulation enabled the possibility to conclude annuity policies that had been financed from company capital. As a result, Jewish employees could receive a disguised tide-over allowance in case of forced dismissal. It appears from the documentation found that insurance companies co-operated in these practices though the official stance of the Corporate group Life insurance and the companies was always reticent towards such activities.

Surrender policies
When the Second Liro Regulation (VO 58/1942) becomes effective on 21 May 1942, the Jews have to report their life insurance policies, annuities, pensions and non-life insurance policies to the robbery bank Lippmann Rosenthal & Co Sarphatistraat (Liro). At the same time they have to surrender their policies. The insurance companies are obliged to report insurance policies of Jewish clients and to pay maturing policies and ongoing annuities to Liro instead of to the policyholders themselves. In addition, not a single legal act (for instance, surrender, pawning, and change of beneficiary) with a Jewish insurance policy is allowed without consent of Liro. Insurance companies are also obliged to present a form to their policyholders on which these have to state if they are Jewish or not according to the definition of the occupier (article 4 of Regulation189/1940).

The Jewish policyholders reported their policies on a large scale and based on this the robbery bank Liro estimated in October 1942 that the expected surrender value of the Jewish policies would be approximately 25 million guilders (including annuities).

Upon the execution of Regulation 54/1943 of June 1943 this appears to have been a realistic estimate. According to this new regulation the life insurance policies that had to be reported in accordance with the Second Liro Regulation, had to be ended as of 30 June 1943. If the policy conditions enabled surrender, the insurer had to pay the surrender amount to Liro as of 30 June 1943. And if the insurance contract did not enable surrender (such as in the case of annuities and pensions), the insurer had to pay three quarters of the mathematically defined premium reserve to Liro.

Insurers under pressure
It appears from the documents that the occupier was very dissatisfied with the execution of the questionnaire by insurers to establish the Jewish identity of their clients. In addition, the insurers often executed the regulations slowly by handling the contracts concerned individually and executing the regulations as much as possible by the letter of the policy conditions.
When it appears in the first months of 1944 that the intended surrender is not progressing quickly enough, the insurers are put under pressure. Liro threatens to appoint ‘Verwalters’ (administrators appointed by the occupier) in the companies to check the administration and report faults of companies to the State Commissioner’s office. Moreover Generalkommissar Fischböck blackmails insurers with the threat to withdraw the previously issued provisional exemption of surrender of small insurances (life insurance policies with a low insured value up to 500 guilders) if the surrender of the other insurances will still not be executed more satisfactorily for the occupier. Due to the pressure still millions of surrender values are received by Liro in the final months of the surrender operation (March to July 1944). The exemption for the surrender of small insurances becomes final in September 1944. It then appears that Liro has robbed over 26 million guilders of Jewish insurance assets. Of this amount, about 23.5 million originates from forced surrenders, while 2.5 million consists of benefits that the insurers were due to Jewish policyholders in the period between the reporting regulation (58/1942) and the surrender regulation (54/1943).

Surrender operation
During the so-called surrender operation, which took place from March to July 1944, three categories of policies were not surrendered:

  1. a) The exemption categories defined by the occupier, such as insurance policies of mixed marriages whose children were not regarded as Jewish; insurance policies of which the beneficiaries were not Jewish; insurance policies of de-starred Jews, insurance policies that had not yet accrued any value.
  2. b) Small insurance policies were first provisionally and as of September 1944 definitely exempted from surrender. Documents found in the insurance archives show that they had in fact often been surrendered as the duty to report small insurances by Jewish policyholders had not been abolished.
  3. c) Insurance policies that had neither been reported to Liro by the policyholder, nor by the insurer.

The legal redress
Already during the occupation the Dutch government in London prepares the principles of post-war legal redress. The Decree Occupational measures (E 93) of 17 September 1944, for insurance, entails that the anti-Jewish possession regulations are deemed to have never been effective. The Decree Legal Redress (E 100) of the same date forms the further basis for the legal redress in which the independent Council for the Legal Redress is given the authority to completely or partially annul or change legal relations that were established or changed during the occupation. Furthermore, the Council is able to revive, whether or not in a changed form, legal relations that have totally or partially been cancelled (such as the surrender of life insurance policies) during the occupation. However, no separate arrangement is made for the restoration of policies, so that the question how the restoration of policies must be concretely arranged, ultimately has to be answered by rulings in procedures which duped persons start against insurers with de Justice Department of the Council for Legal Redress.

When stock is taken after the liberation, most Jewish policyholders are no longer alive. This means that benefits must be paid for these policies, but the insurers had to surrender these insurance policies based on the German regulations. They took the assumption that they had made liberating payments during the war, and therefore no longer had any commitments. After the liberation, the insurers still had to make payments on the basis of E93 for insurance contracts of which the surrender values had meanwhile been paid to Liro. In other words, insurers had to pay twice for the same policy: first to Liro during the occupation and then to the rightholders after the liberation. A complicating factor in this is that the estate of Liro, including the amounts paid by the insurers to the value of 26 million guilders, is considered as practically lost during the first years after the liberation.

No government support
The insurers hold the opinion that they cannot absorb this damage without support from the government. According to the insurance industry, the damage is part of the total financial consequences from the occupation for insurers (there was also war risk damage, ‘Indian damage’ and losses as a result of lowering the interest rate). Therefore, insurers try to bring about a specific legal arrangement for the restoration of policies, which must ensure that the damage is not borne by the companies alone. The negotiations with the Ministry of Finance last until 1948, but right from the start the government refuses to issue a guarantee for the amount that the companies have to reclaim from Liro. The negotiations fail and thereafter the insurance industry and the Ministry of Finance consider reducing the extent of the payments in connection with the restoration of policies by limiting the inheritance rights of Jewish deceased persons to direct relatives (parents, children, brothers and sisters). The Minister of Finance is in favor of such an arrangement, but his colleague from the Ministry of Justice considers this a violation of the constitution and consequently this proposal also fails. In addition, the Minister of Justice has objections against the draft arrangement in which individual companies that would face problems due to large restoration amounts, would still receive financial support. A legal arrangement is not made.

In the meantime, the companies are reluctant to complete restore the policies. They try to oppose the procedures that have been initiated with the Justice Department of the Council for Legal Redress since the beginning of 1946. But ultimately they have to resign to the jurisprudence, which is favorable for policyholders. The most important rulings by the Council are made in the period 1946-1949. As of 1946, there is a fixed jurisprudence and most of the rulings are in favor of the Jewish rightholders. The outcome of the procedure is largely that ‘on the condition of payment of the overdue premiums with interest, the insurance contracts are restored unless the company can prove that restoration is unfair’. This means that a life insurance policy is restored if the policyholder is alive. In case of an annuity of which the beneficiary is still alive, the payment of the benefit is resumed. And if it concerns a life insurance policy of which the policyholder has died, the beneficiary or heirs receive the insurance benefit. Annuities are – completely in accordance with the insurance conditions – no longer paid out if the beneficiary has died. The rightholder receive a claim on the estate of Liro, which was renamed LVVS – Liquidatie van Verwaltung Sarphatistraat – after the liberation if it concerns benefits due which have been paid to Liro in the period been the reporting regulation of May 1942 and the surrender regulation of June 1943. Overdue annuity benefits, which should have been paid after the surrender date, are afterwards still paid by the insurers.

Council for Legal Redress
The Council for Legal Redress further determines that insurers have to pay interest on the benefits if they have been give notice of default and this can only be the case from the moment that the necessary documents for the benefit are present. For the restoration of policies that have lapsed due to suspension of premium payment during the occupation, the Council for Legal Redress makes a distinction between economic impotence and true force majeure. If true force majeure is determined, for instance in the case of deportation of going into hiding, the policy is restored. The insurers are awarded a claim on LVVS by the Council for Legal Redress equal to the surrender amount paid to Liro, but it does not become clear until between 1948 and 1950 that a claim on LVVS can partly be paid out. However, ultimately the insurers only receive ninety percent of the acknowledged claim from LVVS. The consequent jurisprudence that is developed in this way forms the basis of the amicable policy restoration that the insurers agree with individual rightholders out of court. Furthermore, between 1948 and 1954 two agreements are made about unclaimed insurance policies between insurers and administrators or the government which have been based on the principles of the jurisprudence developed by the Council for Legal Redress.

BAON Foundation
The policies of the rightholders who are still alive and present themselves are restored in this way. In order to also restore the policies for which no owners, beneficiaries or heirs have presented themselves, the Nederlands Beheersinstituut (NBI, Netherlands Administration Institute) appoints at the end of 1947 de Stichting Bewindvoering Afwezigen en Onbeheerde Nalatenschappen (BAON, Foundation Administration Absent People and Unattended Inheritances) as administrator of all absent people whose names appear in the administration of LVVS. On 10 June 1948, an ‘Agreement’ is made between BAON and the insurers. This ‘agreement of conditional legal redress’ entails, among other things, that the companies co-operate in the provisional restoration of the unclaimed policies in accordance with the principles of the jurisprudence that has meanwhile been developed. Deeds containing this are drawn up and if someone can still identify himself as rightholder of the insured benefit, the provisional restoration becomes final. In that case the insurance company pays the benefit to BAON, which is responsible for the payment to the rightholder. Subsequently, the company is safeguarded by BAON against claims of other persons who might later be able to make claim to the benefit as rightholders.

Veegens agreement
In the years after the realization of the Agreement (1948 tot 1954) it appears that no rightholders presented themselves for part of the unattended policies. According to the Civil Code, goods to which no one makes claim (an unattended inheritance) are forfeited to the State. In other words, the State is the heir of these inheritances and therefore, the life insurers make the Agreement to Amicable Legal Redress (the so-called ‘Veegens agreement’; named after the State attorney mr. Veegens) in September 1954. The States renounces the collection of the insured amounts to which it its actually entitled and accepts the surrender values of these unattended policies. The difference between the insured value and the surrender value is left up to the companies, so that these will still receive some compensation for the substantial damage as a result of the war. The insurance companies pay the surrender values of the unclaimed policies (which had been provisionally restored and could no longer be finally restored as there were no rightholders anymore) to the State, where they come into the possession of the State Property Department. A clause is included in the agreement that the State, after submission of an inheritance certificate and a death certificate, the State will pay the surrender amount to the insurer concerned if rightholders should still present themselves. The insurer will then arrange the payment to the rightholder.

In 1956-1957 the State cashes NLG 697,155.07 in connection with the Veegens arrangement. After restitution of the surrender amounts to insurers in connection with restoration that takes place afterwards, the final amount of the surrender values of unclaimed insurances is NLG 429,907.96. This entire process in settled by the policy restoration department of NBI in co-operation with mr. Veegens.

Role of auditors
Both the activities of BAON for the benefit of the provisional legal redress and the payment of the surrender amounts to the State are checked by the auditors’ bureau Nieuwenhuis & Bos by order of the Central Auditors service of the Ministry of Finance. From the auditors’ reports it appears that all policies in the administration of LVVS have been checked and that from that moment on the State is an interested party. The companies have to render account of the policies that have not yet been restored. Another conclusion from the reports is that it occasionally occurred that interested parties were not informed of the restoration of their policy. Furthermore, a proxy signed by the heirs was not in all cases asked from the notary. Finally, in some cases after the final restoration a payment was sometimes made to intermediaries (guardians, estate notaries, curators) instead of to the rightholders.

According to the final conclusion of the auditors the restoration of policies has met reasonable requirements. The documentation that was found with several insurance companies in connection with the investigation of the Scholten Commission not only confirms but even reinforces this conclusion.

Insurance assets that were robbed via other routes
Burial insurances that had be covered by burial associations, were not included in the reporting and surrender obligation of the Liro regulations. The reason was that such contracts were mostly based on membership of entirely or partially idealistic, cultural or religious associations or foundations. As far as the investigation of the Scholten Commission could ascertain, there was only robbery, with one exception, when it concerned Jewish associations or foundations. These were liquidated and the assets of the association were entirely confiscated by the occupier, in this case the CNCV (Commissariaat voor niet Commerciële Vereenigingen en Stichtingen, Commissariat for non-commercial Associations and Foundations). In the case of non-Jewish associations or foundations, several situations were possible, depending on the regulations that were deemed to apply to that specific association by the occupier. In practice this meant that Jewish members were banned from the association in which the burial arrangements associated with their membership were cancelled or that their arrangements or insurance contracts were cancelled as their membership fees or premiums were no longer paid after they had gone into hiding or had been deported.
The legal redress of such agreements was not subjected to a system, or to specific guidelines. For an important part it was up to the association or foundation how it dealt with the restoration of such memberships of survivors and with compensation for undelivered services. This applied specifically to burial associations with in kind services, which had not been able to render these services as the burial of the deceased concerned could not be arranged by the association. It appears from case studies that a search was made for solutions, while burial associations were sometimes bound by the rules of the industry. It is likely that not everyone experienced restoration or compensation as equally satisfactory.

The Scholten Commission has not been able to properly investigate the legal redress of Jewish burial associations due to lack of relevant materials from the archives. However, it is clear that over 71 per cent of the estate of CNCV became available for restitution after the war. No conclusions can be drawn about how the repayment to individual rightholders took place. There must have been ‘restoration in restoration’: this means that after the restoration of the associations, including the restitution of part of the robbed assets, the individual members or their rightholders must have received restoration of or compensation for their rights.

Conclusions about policy restoration
The Jewish policies which were robbed by Liro via the anti-Jewish possession regulations and which were therefore included in the post-war administration of LVVS, have mostly been restored in a well-organized but complicated system. Because of the concerns about the financial losses as a result of the circumstances of the occupation, the insurers initially hardly co-operated in full restoration of policies. The government did nothing to financially support the insurance industry or to come to a special legal arrangement for restoration of policies. That the restoration was ultimately arranged in a careful manner is thanks to two factors. The first is the rulings of the Justice Department of the Council for Legal Redress, which defended the interests of the Jewish stakeholders. The second was the realization and execution of two agreements with respect to the restoration of unattended policies under the auspices of the NBI by the BAON, LVVS and the insurers that took care of a bureaucratic administrative handing of the restoration of policies. The interests of the State as heir were incorporated into the system of legal redress and have been an important motivation for the control of the restoration of policies by the companies.

Possible shortcomings in the legal redress
Investigation into the system of robbery and legal redress shows that in some categories there may have been shortcomings in the legal redress of Jewish policies:

1) Insurance policies that have not been reported to Liro (and therefore have not been surrendered), but have been terminated through cancellation because of the circumstances of the Jews. It is possible that the value of these policies, when they were not claimed, remained with the insurers after the war, which is also true for policies that were exempt from premium payment. Due to the exemption of the surrender of the small insurance policies (which, however, were included in the administration of Liro in most cases, as they had to be reported by the Jewish policyholders), there is a somewhat larger chance of a gap in this category.

2) Individual policies which occasionally slipped through the net due to the complicated situation of the Jewish policyholders, the difficult means of proof regarding the declaration of death or the complicated system of the legal redress.

3) Burial insurances that had been contracted with burial associations and had not been robbed by Liro, but had been terminated in other ways during the occupation and which have not been satisfactorily restored or compensated.

The conclusions which the Scholten Commission had included in its final report with respect to ‘legal redress in a general sense’ largely apply to the insurance industry as well. The Commission, for instance, concluded that it took a long time before the legal redress was realized and in addition that in interpreting the rules there was often little attention for the interests of the dispossessed (the robbed persons). The Commission concludes that the legal redress of insurance contracts ‘has systematically actually taken place’. However, it added the remark that ‘some possible shortcomings in the system’ of the legal redress have been found. These relate to life insurance policies, especially the so-called small insurances which were excluded from the reporting and the surrender during the occupation. The legal redress with respect to burial insurances may also have been incomplete.

Finally, Scholten concluded that the surrender values of the policies for which no rightholders had presented themselves, had been paid to the State in the years 1956-1957. This was fully in conformity with an arrangement that had been laid down in the Civil Code. According to the legislation, the State was the heir of the unattended inheritances. If the rightholders would still present themselves to the State after the payment to the State had been made, the policies were paid out after all. The difference between the surrender value and the insured value of the uninherited policies remained with the insurers.

An important (final) conclusion in the investigation is that systematically no monetary values of Jewish policies had remained with the companies. The insurers were allowed by the State to keep part of the insured values of the uninherited policies (1.3 million guilders). Conversely, the insurers received ninety per cent (almost 19 million guilders) back from the acknowledged claim on LVVS, while they had paid 23.5 million guilders in surrender amounts. The released reserves of the annuities as well as the payments of insured amounts which the insurers made on term life insurance policies have been excluded from these calculations.

… and recommendations
The recommendations which the Scholten Commission included in its final report with respect to the legal redress of the insurance policies were twofold. Both the insurers and the State were recommended to make ‘a financial gesture’ and to consult the Jewish community, which socially represented the dispossessed, for this. In addition, the insurers have to investigate their administrations for policies that have not been paid in order to take away the uncertainty about the restoration of individual policies as much as possible. An auditors’ firm – within the control of the Insurance Chamber – must not only check these data but also publish them.

Agreement between the Association of Insurers and the Central Jewish Board (CJO)

The Association of Insurers and the CJO supported the recommendations of the Scholten Commission and made an agreement in November 1999 about the restitution of the insurance assets. The most important goal of the agreement was to create clarity for the victims of the persecution of the Jews and their surviving dependents about unclaimed insurance assets. The agreement should be regarded as a final settlement. The insurance industry made a total of fifty million guilders available: twenty million was earmarked for individual benefit payments, twenty-five million for goals that were determined by the Jewish community itself and five million for a research and internet project Monument Jewish Community (