Equitable Life is going to the wire over the imposition of exit penalties on policyholders, waiting until the 11th hour to respond to the Office of Fair Trading's threats of legal action.
The OFT contacted Equitable on February 8, giving the company until March 1 to defend its policy of having absolute discretion in deciding what market value adjuster to impose on policyholders.
The OFT says Equitable's 10 per cent penalty is fair but says it is not fair for Equitable to have absolute discretion in setting the penalty and is awaiting a response.
The news comes as policyholders have been told that there will be no reversionary bonuses added to policies in the near future.
Equitable spokesman Alistair Dunbar says: “We will be responding to the OFT before the deadline.”
Equitable says former Scot- tish Widows appointed actuary Charles Thomson is taking over from Chris Headdon as chief executive. Thomson is credited with salvaging Widows from its guaranteed annuities by clinching the deal with Lloyds TSB.
He joined Equitable as chief actuary in January after his surprise departure from Widows. Headdon will bec-ome chief executive of the newly integrated Halifax Equitable business.