Holocaust Payments Resolved

European insurance companies would pay about 10 times the face value of Holocaust-era insurance policies to survivors and families under a formula reached by Lawrence Eagleburger, chairman of the claims commission, a U.S. official said Monday.

This could clear the way for payment of claims against German insurance policies, beginning in October, with payments reflecting inflation and interest since the policies were purchased.

The five insurance companies involved with the commission have set aside $100 million for paying the claims, including administrative costs.

Neal Sher, vice chairman of the commission, said Monday that the former Secretary of State's decision was based on "what he considers to be fair compromises."

Sher, who was the chief prosecutor of ex-Nazis in the Justice Department, said "the expectation now is that we will move forward and launch our worldwide effort to attract claimants and to pay legitimate claims."

Working groups will meet in London this month and the commission will then meet there Sept. 22-23 to finalize an outreach program to locate and arrange payments for victims and their families.

Eagleburger's decision, reached Friday but not announced, made some changes in his initial, tentative ruling of a week earlier that had been challenged by major insurers, Sher said. But the basic outline remained intact.

Elan Steinberg, executive director of the World Jewish Congress and a member of the commission, said "we accept the good faith judgment of chairman Eagleburger and we will move forward to rapid payout of these policies."

Glenn Pomeroy, North Dakota insurance commissioner, who headed the state regulators on the commission, reportedly warned insurance companies that if they carried out threats to quit the commission, they would be open to punitive action by state insurance regulators.

A spokesman for the German insurance company Allianz said last week that all five European insurers, in varying degrees, were pressing the former secretary of state for changes.

"The concerns are not only about the money, but about the process as well," spokesman Nicolai Tewes said in a telephone interview from Munich. "It would be a misunderstanding that the companies are only trying to save some money. The companies want to find a process that works and makes sense to the people who are waiting for the money."

Eagleburger stepped in when the commission could not agree on a formula that would have determined current values on policies taken out some six decades ago.