Members of life insurance company Equitable Life to receive GBP1.5bn payout
Wed, 20 Oct 2010
Members of the troubled life insurance company Equitable Life, with whom a million savers lost £4bn after a decade of mismanagement and poor regulation, will get £1.5bn in compensation from the Coalition Government.

After Equitable Life was pushed to the brink of administration in 2000, their members, many of who lost all of their pension savings with the company, have been fighting to get compensation from the Government. The Financial Services Authority (FSA) was held responsible for the poor regulation that caused Equitable to fail.

The Parliamentary Ombudsman conducted two detailed investigations into Equitable Life's collapse and recommended that its members be compensated with a payout of between £4bn and £4.8bn for their losses.

However, the most recent report under the previous government suggested a payout of between £400 and £500m. The new deal triples that figure, but falls far short of the original recommended payout. The Treasury has indicated that payouts could begin as early as mid 2011.
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