A French insurance firm has paid compensation to descendants of Armenians massacred in World War I based on life insurance policies taken at the time, a community group said Thursday.

Thousands of families applied for compensation through policies that their Armenian ancestors bought under the Ottoman Empire from companies that were later taken over by the French firm, Axa.

Hilda Tchoboian, the head of an Armenian association in the French city of Lyon, told AFP that Axa had agreed to pay nearly 1,000 Armenian, French and American families, and had started sending cheques of about 8,000 euros each.

Armenians say up to 1.5 million of their kin were systematically killed between 1915 and 1917 as the Ottoman Empire, the predecessor of modern Turkey, was falling apart.

Several countries, including France and Canada, have branded it a genocide.

Turkey rejects the genocide label and argues that 300,000-500,000 Armenians and at least as many Turks died in civil strife when Christian Armenians took up arms against their Ottoman rulers and sided with invading Russian troops.

Axa is the second insurance company to pay compensation to descendants of massacred Armenians. US company New York Life agreed in 2005 to pay 12 million dollars (8.8 million euros) to victims' heirs.