The end of the road: Equitable Life sold for £1.8bn to LCCG
Life Company Consolidation Group (LCCG) is buying Equitable Life for £1.8bn 18 years after the company was forced to close to new business in 2000.
The worlds oldest mutual assurer was at the heart of a financial scandal back then with many policyholders losing out, and had been closed to new business since.
It has hundreds of thousands of policyholders and they will now move to specialist life assurance group LCCG's Reliance Life subsidiary and the majority of the remaining customers will share in the proceeds of the sale.
Read more: Equitable Life policyholders could be in for pay day
Danny Cox, chartered financial planner at Hargreaves Lansdown, said the move secured an average windfall of £6,900 including the current 35 per cent uplift, though noted that is not guaranteed and could be withdrawn.
He said:
This is a wonderful windfall for Equitable Life policyholders, who now stand to pick up a nice bonus as the With Profits fund and Equitable Life shuts up shop for good.
Theres still a bit of a wait, but the uplift is so substantial its well worth hanging on for.
Paul Thompson, group chief executive of LCCG, said:
We are delighted to have been selected by Equitable Life to be its partner in providing ongoing service, fund choice and security to its policyholders. As a group we have significant experience in delivering policyholder value through well‐managed run‐off processes and our expertise in unit linked assets.
We continue to see significant opportunities to add to our run-off assets through additional closed book life insurance transactions.
The chairman of Equitable Life, Ian Brimecome, said it was sad to bring an end to the mutual assurer, but "the potential to enhance with-profits policy values to the extent made possible by a transfer to Reliance Life is fundamentally helpful in distributing capital to our policyholders as fairly and as soon as possible".
It is expected that the transfer will be tied up by the end of 2019, with policyholders being sent full details about the process later this year.
Read more: The world's oldest mutual insurer under threat from falling interest rates
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