IFAs are steeling themselves to pick up the pieces left by Equitable Life's closure, with most believing that Equitable only has itself to blame for its misfortunes.
But advisers are split on whether to advise Equitable clients to get out while they can or hold on and wait for further developments.
Equitable consistently bran ded itself as the company which did not pay commission to middlemen.
IFAs are now left advising clients on what to do with their policies with the life office closed to new business.
Some IFAs are advising their clients to leave Equi table as soon as possible. Torquil Clark is advising policyholders to move their investments elsewhere. It originally supported staying put while a buyer was found but now says any losses incurred from moving funds is a small price to pay for the poor returns Equitable is likely to give.
Others think that encouraging policyholders to leave in their droves could harm other policyholders and urge investors to seek advice.
Hargreaves Lansdown is warning policyholders not to panic and not make impulse decisions.
Ian Lees & Co Asset Management principal
Ian Lees says: “This has been the result of mismanagement. The directors have known about this for years and the FSA must have been aware of it. They should have made provisions.
“Policyholders have been misled and it is them that I feel sorry for.”
PMI Independent Fin ancial Adviser partner John Stewart says: “If I were a with-profits policy holder I would be pretty nervous but it is better to wait than cut and run.”
An Equitable Life spokes man says: “The life fund remains intact and we will be seeking to generate value by the sale of the fieldforce and Permanent Insurance.
“Other parts of the business will also be under review. Our key task is to create the greatest value for policyholders and to provide the best possible customer service.”