Equitable Life competition scheme condemned
The Parliamentary Ombudsman has today issued a damning indictment of the U.K.'s proposed £400 million payout to Equitable Life suffers, many of whom lost their life savings during the company's near collapse back in 2000. The £400 million compensation scheme, yet to be rubberstamped by the government, equates to just £266 per policyholder despite the fact that a recent report suggested losses for policyholders were between £4 billion and £4.8 billion. So is their new hope for Equitable Life suffers?
There is no doubt that the damning report from the Parliamentary Ombudsman will make the UK government sit up and listen but whether additional funding will be injected into the compensation package remains to be seen. This has taken 10 years to bring to fruition and even now there is great controversy regarding the level of compensation and the admission of guilt on behalf of the UK government. While there is no doubt that the near collapse of Equitable Life, and the massive losses which some customers experienced, were the result of guarantees set up by the company itself the regulatory system in the UK was also called into question.
Whether or not the government is able to introduce more money into the compensation scheme is a matter for discussion in the short to medium term but ultimately there is no way they will increase the compensation pot from £400 million to anywhere near the £4 billion estimated losses.
Prudential admits to further delays in AIG acquisition
The reputation of the Prudential management is today in tatters with confirmation that planned stock market listings in Hong Kong and Singapore have been delayed due to concerns expressed by the Financial Services Authority [FSA] with regards to capital requirements for the enlarged group. While there are no problems with regards to Prudential itself, it is the massive changes the acquisition woul...Read More
Garden security warning from home insurance firm
Neglecting garden security in the summer months could result in a costly home insurance claim, the Cheshire Building Society has warned. According to research conducted by the home insurance provider, around one third of all insurance claims occur during the summer months. Much of the glut of summer claims is due to people failing to secure their garden properly, said Karen Torson, partnerships bu...Read More
What is happening at AIG?
While AIG has a number of businesses which are still trading profitably and will no doubt be sold off if the group does go under, its venture into the loan package market and sub-prime sector has been the downfall of this great giant (even if it survives it will be a different animal from the one only a few weeks ago). So what exactly happened?
Not only did AIG get involved in buyi...
Why did the Competition Commission lose an appeal against PPI?
The very fact that the Competition Commission Tribunal has overturned a recent judgement by the Competition Commission regarding PPI (payment protection insurance) has caused ripples across the whole financial sector. The case set out by the Competition Commission seemed to be fairly straightforward in that many people who agreed loans with their banks and other financial institutions were apparen...Read More
BCC demands increase in VAT not national insurance
The British Chamber of Commerce (BCC) has today pleaded with the UK government to increase VAT to 18.5% instead of increasing the rate of national insurance contributions. Figures from the BCC suggest that the scrapping of next year's national insurance contribution increase would benefit businesses by £5.1 billion while an increase of just 1% in the rate of VAT would bring in around £4.5 billio...Read More