Recently, my researcher Tim attended the APPG on Equitable Life. The biggest issue discussed was that of pre-1992 policy holders who have been excluded from the compensation mechanism.
The group heard from Honor Blackman, who is set to receive a full 100% compensation, while two other victims of the Equitable Life collapse were told they would receive no remuneration for their losses. Mrs. Blackman said that they were all prudent and put money aside for a rainy day, but that was where the similarity ends. She viewed the 1992 cut off date with a burning sense of injustice.
Another attendee who was disqualified spoke about her 91 year old WWII-veteran husband and said that he didn’t fight for injustices like Equitable Life to happen. She stressed that she was not asking for extra benefits – just what is owed.
EMAG are challenging this discrepancy and feel that because these people are in their 80s and 90s, their need is desperate as time is running out for justice.
The recently published Equitable Life Payment Scheme Design sets out in detail what to expect for the post-1992 policy holders, while a letter from Mark Hoban has stated that:
Policy holders do not need to do anything to claim their payments – the Scheme has policyholders’ details from Equitable Life and the Prudential, and will contact policyholders directly in the first instance.
All payments will be tax free and will not affect eligibility for tax credits.
The Payment Scheme also provides an updated timeline for repayments:
Most WPA policyholders can expect to receive their first payment by June 2012. Payments for WPA policyholders’ past losses will be evenly spread over the first five years of the Scheme, and future losses will paid by the Scheme over the lifetime of the policyholder, or for the fixed or guaranteed term of the policy. This means that most WPA policyholders will receive annual payments up to 2016, and many of those with future losses will also receive payments in subsequent years.
Despite recent advances, I know that in the House there is sympathy for the need to compensate the estimated 10,000 people in the pre-1992 group who have been excluded from any reimbursement.
We should always remember that it was the state which turned Equitable Life from a serious problem into a disaster. The state as a provider and turnaround entrepreneur was never going to work effectively. I hope the relevant lessons have been learned.