The following questions were put by Investment Week to the Equitable Life press office What is th...
The following questions were put by Investment Week to the Equitable Life press office
What is the current portfolio breakdown of the with -profits fund?
It's on the website. (These figures are from December 1999)
Can you give any more recent figures?
No, they are not available.
Can Equitable guarantee that it is now fully funded for its liabilities or could there be further cuts?
We are now in line with market values but we cannot predict what the market is going to do so, like any other life company, our investments must follow the market sooner or later.
How much has the with-profits fund fallen in value as a result of stock market moves in the past 12 months?
It achieved a 2.7% growth for the calendar year 2000, which is very successful in investment terms, but policy values have gone up 8% in the same period.
It has reached a point where we have to be fair to long-term policyholders as well as those who have policies maturing now.
The MVA applied in some cases went as high as 22%, why was that when the reported exit penalty was only 15%?
The 15% figure is for individual policies. The MVA for group schemes are variable and as there is one large single transaction for each the figure is likely to be closer to 20%. The MVA for group schemes is available on request.
There has been talk that Equitable has been dragging its feet on securing the funds for transfer upon the request of policyholders. Will those who had received confirmation the funds were to be transferred but had not yet been transferred also be affected by the 16% cuts?
Where we have received an instruction before 16 July they will not be affected by the cuts. If we have received notification but not all the documentation required then policyholders will have extra time from the date when we ask for the additional documentation, which will be seven days for life policies and 14 for pensions. We will look at individual cases on their merit.
Equitable said it could not provide illustrations of the value of a GAR for a particular policy for regulatory reasons. The FSA has confirmed that you can. Why have you not provided such illustrations?
The estimate of the total value of GAR is on the website.
How many requests for transfers have you had this year?
There has been about £25m worth of transfers per week since February, which is about twice the level experienced in previous years. We do not have the figures in terms of numbers of policies and we do not regard this as being as important as the level in cash terms.
What are your expectations for the equity and bond markets this year?
We do not do economic forecasts, but we are not as optimistic as we were earlier in the year.
From what date does the 16% cut apply?
From 31 December 2000.
Does the 16% cut apply to all policyholders or are those who joined within a period, of for instance 12 months, exempt?
Unless there is a contractual opportunity to leave, all policyholders are affected.
Why did you not declare yourself insolvent in January? Wouldn't policyholders have been better off?
We were not insolvent and if we had been, policyholders would not have received their final bonuses, so they would have been much worse off.
How many additional staff have you recruited to deal with the large backlog of correspondence?
We have taken on 100 staff on a temporary basis to take telephone calls and we recently had a recruitment drive to take on 100 permanent staff, but I'm not sure how that is progressing.
£92bn transferred since 2015
Achievements, charity work and other happy snippets
Since first announcement