Equitable Life plans to offer millions to policyholders ahead of potential sale

James Booth
Policyholders could receive a windfall of several thousand pounds

Equitable Life is set to offer policyholders millions as part of a plan to restructure and sell the 256-year old insurance group.

The 300,000 policyholders could receive a windfall of several thousand pounds each under a plan to restructure and sell the group.

A circular set to be sent to members is expected to spell out the details of the plan to release cash that has built up since the fund closed to new members in 2000.

The mutual insurance group was founded in 1762, but closed to new business in 2000 following a funding shortfall.

Many members lost thousands of pounds in savings as the group came close to collapse.

The Government paid £1.5bn in compensation to members who had lost out financially.

The scheme is being driven by chief executive Chris Wiscarson, with the ultimate goal of finding a buyer for the fund.

Banking giant Goldman Sachs has been appointed to find a seller for the fund, although there are legal obstacles to an immediate sale.

Releasing the surplus cash to policyholders would help clear the way for a possible sale.

Speaking to the Financial Times last week Wiscarson said: “We are determined to distribute greater amounts of capital to policyholders, and we are hopeful of being able to give them some good news in the spring,”

Equitable Life has previously sold off individual units such as a 31,000 policyholders annuity business which was acquired by Canada Life in 2015 for £875m.