Equitable Life: compensation scheme
This note is designed to summarise the processes and principles behind the Equitable Life compensation scheme. It is designed to help constituents who wish to know what they might expect and what they have to do if they believe that they are due compensation.
The Coalition Government of 2010 accepted the Parliamentary Ombudsman’s recommendations to pay compensation to Equitable Life policyholders who had been affected by the company’s financial problems going back 25 years and the failure of government bodies to prevent such problems.
After consultation a Compensation Scheme was established. It was an enormous administrative task attempted in a short time span. The Scheme was criticised as not being nearly generous enough by Equitable Life policyholders and by the National audit Office for operational problems.
Nevertheless the Scheme managed to pay nearly £1.08 billion to 915,453 policyholders by September 2015 which was about 88% of eligible policyholders, and 92.9% of the money due.
The Scheme is due to close in December 2015.