UK - Equitable Life pensioners were drawn into investing in the firm's with-profits annuities by promises the insurer could not meet, a new report claims.
Research by Equitable Life Trapped Annuitants shows that some pensioners involved have seen their annuities slashed by nearly 30% – far more than the 20% the company claimed when it announced the cuts last year.
The study – Equitable Life and its Handling of With-Profits Annuities – states the annuities originally offered by the beleaguered insurance firm were probably unsustainable and that regulators should have realised this sooner.
ELTA member and the author of the report, Peter Scawen, said: “The actuaries employed by the government regulator cannot have been unaware of both the presentation and the reaction of its members and yet no action was taken then or now.
“How did this deeply flawed system ever get the approval of the government regulators?”
For a full copy of the report, visit www.elta.org.uk.
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