Victims of the Equitable Life scandal, who lost £4.3 billion of their retirement savings through years of mismanagement and regulatory failure, will begin to receive compensation in the next month, the Treasury has announced.
Publishing the details of the Equitable Life compensation scheme, the Treasury stated that the oldest policyholders would receive payments first and that the compensation payments could be paid as early at the end of June 2011.
Relief for Equitable Life policyholders
This is relief for the 945,000 policyholders who have been waiting for successive governments to take responsibility for the Equitable Life saga and remunerate those who have lost out for over a decade. They will be paid £775m for their losses, while around 37,000 with profits annuity policyholders, who will be compensated in full, will share £620m.
The scheme will take five years to repay policyholders, and the Treasury believe that £1bn will be paid out by 2014.
How much will Equitable Life members realistically be receiving?
According to the Commission on Equitable Life Payments figures, the highest proportion of policyholders (20%) will receive between £100 to £250 in compensation, accounting for nearly 200,000 policyholders.
But closer analysis of the figures shows that more than half of those affected by the Equitable Life saga will receive £250 or less in compensation. Of the 945,024 policyholders eligible for compensation, 532,977 will receive up to £250. On the other end of the scale, 43 policyholders are eligible for more than £250,000 in compensation.
Where can I find out more?
Which? has created a guide to the Equitable Life Payment Scheme, which contains all the essential information you need about the compensation process. The Treasury has also set up a special website and a helpline for Equitable Life policyholders, which can be contacted on 0300 0200 150.
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