11 January 2008
More than 400 people holding with-profits annuities with the
Equitable Life have won compensation for being mis-sold their
policies.
Equitable Life has settled a High Court action brought in 2004
on behalf of 407 policyholders. The terms of the settlement are
confidential, but lawyers for the claimants said they were
delighted with the settlement.
The with-profits annuity business has since moved to the
Prudential.
With-profit annuities are pension policies in which the
policyholders' money continues to be invested in a with-profits
fund after retirement. The Equitable Life with-profits fund was
once largely invested in shares. Since it's near collapse, the fund
has been invested mainly in much safer but lower-yielding bonds,
which has meant a big reduction in the pensions being paid.
