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Equitable Life compensation update

Equitable Life compensation update

Category: Investments

Updated: 27/01/2011
First Published: 26/01/2011

MONEYFACTS ARCHIVE
This article was correct at the time of publication. It is now over 6 months old so the content may be out of date.

The Government has announced more details on compensation for Equitable Life customers.

Former policyholders have been battling to reclaim funds they lost when the business almost went bust a decade ago.

Mark Hoban, Financial Secretary to the Treasury, said that 945,000 customers would share £775 million between them, repaying 22% of their losses.

The judgement was recommended by the Independent Commission on Equitable Life Payments, which was set up by the Government last year.

The ruling is part of the package that was announced in 2010, which deemed that all 1.5 million people affected would share compensation of £1.5 billion - £620 million of which has already been allocated.

A timetable of payments will be published in the spring, although older policyholders will receive payments first.

Those that have only lost £10 or less will not receive any compensation.

"We have always been committed to making fair and transparent payments to Equitable Life policyholders, through an independently designed payment scheme, for their relative loss as a result of regulatory failure," said Mark Hoban.

"I am grateful for the work the Commission has done to establish policyholders' concerns and have used this to recommend the principles of the payment scheme. I welcome their recommendations and we will now use them as the basis for making payments to policyholders."

Brian Pomeroy, chair of the Independent Commission on Equitable Life Payments, said he was pleased that the Government had listened to the recommended principles.

"The Commission has listened carefully to the views of interested parties and we believe that our conclusions will deliver an outcome that is simple, transparent, and fair for policyholders."

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