Shareholders have reacted angrily to news that ousted Royal & Sun Alliance chief executive Bob Mendelsohn was paid £2.5 million sterling for nine months' work.
Mr Mendelsohn, who spent four years running the company on a two-year rolling contract, left in September.
On top of a basic salary of £600,000 and allowances of £416,000 during 2002, he was handed £1.44 million in compensation for the loss of office.
A spokesman for the National Association of Pension Funds, which represents the interests of occupational pensions, said: "This highlights why we are opposed to people being on two-year rolling contracts.
"That's nearly £3 million of shareholders' money up the spout. If he had been on a one-year contract it would have been half that".
Smaller shareholders were also shocked at the scale of the payments, which were revealed in the company's annual report, just weeks after London-based R&SA was relegated from the blue chip FTSE 100 Index.
David Blundell, national chairman of the UK Shareholders Association, said: "This is just one part of what many ordinary workers and our members believe is little more than legalised theft among big business.
"Senior executives of the larger listed companies are getting quite breathtaking levels of earnings for, in most cases, under-performance," he said.
A month ago the world's oldest insurer slashed its dividend payout by 60 per cent and unveiled operating profits at the low end of market expectations. R&SA's value has slipped to £1.1 billion from £10.4 billion since 1998.