Long-suffering policyholders at Equitable Life have been awarded increases of up to 5.5% in policy values.
The failed mutual said it was pleased to announce that, with immediate effect, it has reintroduced interim bonuses and reversed the reduction in policy values made in March 2009 as follows:-
An interim bonus of 3.5% has been awarded to UK with-profits pension policies; in addition, policy values of UK with-profits pension policies have been awarded a one-off increase of 2%, reversing the reductions made on 1st March 2009.
The corresponding figures for UK life policies are 2.8% for interim bonus and a one-off increase to policy values of 1.6%.
Equitable Life chief executive, Chris Wiscarson, says: “The Society is determined to recreate value for policyholders and these increases in policy values are small but important steps along this road.”
The life and pensions provider came close to collapse in 2000 when it could not deliver the returns it had promised.
At the time, over one million savers lost up to 50% of the value of their pension funds.
The issue of compensation was eventually given over to the Parliamentary Ombudsman, Ann Abraham, whose report accused regulators of comprehensive failures and the Government of maladministration.
It also recommended the establishment of a scheme to consider individual claims for compensation.
Early last year, the Government published details of such a scheme, which allowed awards on a hardship basis and therefore left the bulk of Equitable policyholders out in the cold.
Policyholder have since successful in a judicial review of the Government’s decision not to implement the Ombudsman’s recommendations in full and ministers are in the process of reviewing proposals for the compensation scheme.
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