Equitable Life scheme back on track as £535m paid out

In October 2010, the government announced total compensation of £1.5bn for Equitable Life and in June 2011 it its the first payments. The scheme was set a target of writing to all eligible policyholders by mid-2012 and finalising all compensation by mid-2014.

FTAdviser sister title Financial Adviser reported in July last year that a committee of MPs had expressed anger after an initial deadline to compensate certain individual policyholders was missed. Although some of the relevant policyholders received payments, others did not.

The All Party Parliamentary Group on Equitable Life wrote to Mr Hoban, then financial secretary to the Treasury, to raise concerns about delays.

In its latest update, the scheme outlines that 370,867 policyholders were compensated by the end of January 2013.

Of this, 339,794 individual non with-profits annuitants have been issued with lump sum payments totalling £426m; 30,997 with-profits annuitants have received two separate payments from the scheme totalling £100m; and payments to 76 group schemes have been made totalling £9m.

With a third of the redress having been paid in around six months since compensation payments began, the government has said the scheme is on track to complete the redress programme by mid-2014 as planned.

The progress report specifically states the scheme is on track to complete payments to all individual policyholders it can trace by April 2013.

It adds that the scheme has written to the Trustees of all 5,700 eligible company schemes to obtain policyholder contact details and that payments to these individuals will accelerate from April 2013.

The scheme has also made payments to the estates of 5,760 deceased policyholders and continues to identify, trace and contact estates.

The scheme will publish another report in early May 2013.