Equitable Life payments
Updated 26 March 2014
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1. Payments to pre-September 1992 Equitable Life With-Profits Annuity (WPA) policyholders announced at Budget 2013
At Budget 2013 the Chancellor of the Exchequer announced that the government would make a single ex gratia payment of £5,000 to the approximately 9,000 individuals who have had one or more With-Profits Annuities from the Equitable Life Assurance Society which had begun before 1 September 1992. An additional £5,000 would also be paid to those policyholders who were in receipt of Pension Credit on 1 November 2013.
Payments totalling approximately £46.8 million were made to this group in December 2013 with the assistance of the Prudential Assurance Society.
Those policyholders eligible for one of these payments were only those who currently were on 1 November 2013 receiving regular annuity payments from the Prudential Assurance Society in relation to one or more Equitable Life With-Profits Annuity or Annuities purchased before 1 September 1992.
2. Pension Credit
The government recognised that the pre-September 1992 Equitable Life WPA group consisted of policyholders with a range of different circumstances. Therefore the government focused the available funds on those policyholders who needed it most. If someone is in receipt of Pension Credit they will have had their financial situation assessed, and will have a low income.
3. Payments to deceased policyholders
Because these payments were intended to help relieve some of the pressures associated with living with a reduced annuity income, the government decided not to make payments to those pre-1992 Equitable Life With-Profits Annuitants who were already deceased by the date of the Budget announcement. This was also in order to maximise the payment available to living policyholders. However, should an annuitant have passed away after the announcement on 20 March 2013 before receiving their payment, the payment was made to their estate.
These estates received a payment of £5000 regardless of whether the deceased policyholder had been eligible for Pension Credit prior to their death. This is because these payments were intended to support living policyholders.