Life Insurance Search

The Parliamentary Ombudsman has made its long awaited report into the near collapse of life insurance company Equitable Life.

It said that the government has a responsibility to apologise to consumers for “a decade of regulatory failure” and should seek to compensate all those whose retirement savings were hit by the financial troubles of the life insurance company.

Parliamentary Ombudsman Ann Abraham identified no less than ten examples of maladministration by government departments.

She commented, “Those responsible for the prudential regulation of Equitable Life failed to do so throughout the period covered in my report.

“I have alerted Parliament to the injustice which I have found in this case resulted from serial maladministration on the part of the former Department of Trade and Industry, the Government Actuary's Department and the Financial Services Authority.”

She added that a government compensation scheme should be set up to provide compensation to all those who had lost out. “The aim of such a scheme should be to put those people who have suffered a relative loss back into the position,” she said.

Meanwhile, the chairman of the life insurance company in question welcomed the report’s findings. “From a policyholder point of view we think this is as formidable a report as the Ombudsman could possibly have produced," he said.

Adding, "We could not really have asked for more. Her reasoning and recommendations are beyond argument."