Following the publication of Equitable Life interim accounts on Friday (15/11), the provider has admitted that it may breach minimum capital adequacy requirements. These are the minumum financial strength positions that all financial institutions have to comply with to continue trading.
In simple terms, if the industry regulator, the Financial Services Authority, believes that there is a breach of capital adequacy, they can 'shut Equitable down'. This follows also on Friday an announcement by Equitable that they intend to reduce bonus rates on their ailing 'with profits' fund by 20% and that they have reduced their investments in the stockmarket to just 5%. This is always an indication that a provider is worried that any adverse movement in the stockmarket may seriously affect their financial strength.
Many commentators use the stockmarket exposure figure as a benchmark of confidence in the strength of a organisation. With this news, we believe all policyholders should be worried and seek professional help immediately. Getting help from on Equitable. You can request a copy of our fact sheet on Equitable Life outlining your options or why not just contact us or telephone us to discuss your concerns on 01543 677444.
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