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Anthony Hilton: Insurer proves you can come back from the brink

 

Anthony Hilton
Saturday 29 March 2014 02:42 GMT
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Banking regulators are increasingly making their presence felt in insurance, and by and large the insurers don’t like it because they think theirs is a completely different business – particularly when something goes wrong.

Banks fail spectacularly overnight and there is not much management can do about it by that point; failed insurers struggle on for years and how their decline is managed can make a big difference.

Equitable Life proved that point on Monday. Its crisis, the biggest in modern times in insurance and pensions, began in the late 1990s, but the rump of the company is still with us. And on Monday the chief executive, Chris Wiscarson, was able to announce that the finances were now strong enough to double the level of capital distribution to with-profit policyholders, and also to remove the 5 per cent penalty for those wishing to transfer their savings elsewhere. It is the pay-off for management’s skilled husbanding of resources and shrewd investment moves.

It is not the sort of stuff that makes headlines but it will make a real difference to the policyholders – and there are still 345,000 of them.

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