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Last June we announced the Proposal, which if approved, would mean the following for with-profits policyholders*:
- The value of your With-Profits Policy would be uplifted (increased). We expect Policy Values to increase by around 60-70% at the time that the Scheme is implemented (which we expect would be the end of 2019). It would happen instead of the Capital Distribution, which at the moment is 35% of Policy Values, which currently is added when Scheme Policyholders take their benefits.
- Any Investment Guarantees attached to your With-Profits Policy, including any guaranteed annual increases and any With-Profits Switching Rights will be removed;
- The increased value of your With-Profits Policy will be converted to a Unit-Linked Policy.
* excluding policyholders who only hold With-Profits Policies governed by German law
Alongside those changes, we also propose to transfer almost all of the Equitable’s policies to Utmost Life and Pensions (who used to be known as Reliance Life) – visit the Utmost Life and Pensions website.
Policyholders not in our With-Profits Fund
Details of how the Proposal will affect you will be sent in the summer.
What is the latest with the Proposal?
We have just sent out an Introduction to the Scheme booklet to affected with-profits policyholders – see the booklet.
This booklet is really important as it contains details of your legal rights regarding proposed changes to your With-Profits Policy and we recommend you read this and let us know if you have any questions. The key question to focus on at this time is whether you object to our intention that all policyholders who will have a vote should vote together as part of the same “Class”. This issue is explained in greater detail in the Introduction to the Scheme booklet.
What happens next?
We are currently scheduled to have a hearing at the High Court on 22 July 2019, where we ask for permission to hold the Policyholders’ Meeting. If that date changes then we will put an update on our website.
If the High Court permits us to go ahead, we will send with-profits policyholders two important packs of information:
- A Personal Illustration
- Explanatory Booklets providing all the key information about the Proposal
- Voting Form (where applicable)
- Details of the help and support available to help you make a decision
- Details of the unit-linked funds that you would be able to choose from if the Proposal goes ahead
- An Investment Choice Form
- Details about how your savings will be invested if you do not make an investment choice
- Details of the support available to help you make a decision on which unit-linked fund(s) to choose
The expected timeline for the proposal
Click below to expand for more information
|Event||Time and Date|
|The introduction to the Scheme sent to Scheme Policyholders||
|First Court Hearing||
22 July 2019
The hearing at which the Equitable will seek the High Court’s permission to hold the Policyholders’ Meeting.
|The hearing at which the Equitable will seek the High Court’s permission to hold the Policyholders’ Meeting.|
|Decision Pack which includes the Explanatory Booklet and Voting Forms sent to Scheme Policyholders||
By early August 2019, shortly after the First Court Hearing
If the High Court gives permission for the Policyholders’ Meeting, this would provide you with details of the Proposal so that you can decide how to vote and whether you wish to object.
|If the High Court gives permission for the Policyholders’ Meeting, this would provide you with details of the Proposal so that you can decide how to vote and whether you wish to object.|
|Investment Choice Pack||
By mid-August 2019
This information would explain the unit-linked funds that would be available for your policy, if the Scheme were to become effective. You should decide on a unit-linked fund, seeking any advice you need.
|This information would explain the unit-linked funds that would be available for your policy, if the Scheme were to become effective. You should decide on a unit-linked fund, seeking any advice you need.|
|Deadline for receipt of Voting Forms for the Extraordinary General Meeting||
10.00 a.m. on
The date by which postal votes on the Change to the Articles would need to be received.
|The date by which postal votes on the Change to the Articles would need to be received.|
|Deadline for online Voting Forms for the Change to the Articles||
10.00 a.m. on
This would be the last date for online voting on the Change to the Articles.
|This would be the last date for online voting on the Change to the Articles.|
|Deadline for receipt of postal Voting Forms for Policyholders’ Meeting||
10.00 a.m. on
The date by which postal votes on the Scheme would need to be received.
|The date by which postal votes on the Scheme would need to be received.|
|Deadline for online voting on the Scheme||
10.00 a.m. on
This would be the last date for online voting on the Scheme.
|This would be the last date for online voting on the Scheme.|
|Policyholders’ Meeting on the Scheme||
10.00 a.m. on
The meeting of Scheme Policyholders to vote on the Scheme, if the High Court gives permission.
|The meeting of Scheme Policyholders to vote on the Scheme, if the High Court gives permission.|
|Extraordinary General Meeting||
1 November 2019, held immediately after the Policyholders’ Meeting that starts at 10.00 a.m.
If Scheme Policyholders vote in favour of the Scheme in the required majorities, there would be a meeting of the Equitable’s Members to vote on the Change to the Articles.
|If Scheme Policyholders vote in favour of the Scheme in the required majorities, there would be a meeting of the Equitable’s Members to vote on the Change to the Articles.|
|Second Court Hearing||
If Scheme Policyholders vote for the Scheme in the required majorities, and the Change to the Articles is approved at the EGM, this would be the High Court hearing at which the Equitable would seek the High Court’s approval of the Scheme and the Transfer.
|If Scheme Policyholders vote for the Scheme in the required majorities, and the Change to the Articles is approved at the EGM, this would be the High Court hearing at which the Equitable would seek the High Court’s approval of the Scheme and the Transfer.|
|Confirmation on the Equitable’s and Utmost’s websites that the Scheme and Transfer have been approved||
If the High Court approves the Scheme and the Transfer, we would publish confirmation of this on our website.
|If the High Court approves the Scheme and the Transfer, we would publish confirmation of this on our website.|
|The deadline for receipt of Investment Choice Forms to process your investment choice at the Implementation Date||
13 December 2019
If the High Court approves the Scheme and the Transfer, this would be the last date for implementing investment choices at the Implementation Date. You will still be able to make a choice later.
|If the High Court approves the Scheme and the Transfer, this would be the last date for implementing investment choices at the Implementation Date. You will still be able to make a choice later.|
1 January 2020
If the High Court
approves the Scheme
implemented in full on this date, (your policy would be uplifted
and would become unit-linked, while Investment Guarantees
would be removed).
|If the High Court
approves the Scheme
implemented in full on this date, (your policy would be uplifted
and would become unit-linked, while Investment Guarantees
would be removed).
If Members approve the Change to the Articles, it would take effect on this date, making Utmost the sole member of the Equitable.
If the High Court approves the Transfer to Utmost, it would become effective on this date.
Be aware that scammers may use the Proposal we are making as a good opportunity for them to take advantage of you.
Equitable Life will not:
- Recommend or advise you to cash in your policy
- Send text messages
- Contact you by email asking for your bank details
What is a scam?
A scam is where a fraudster tries to gain access to your savings, which may result in money being moved, stolen, or subject to unreasonable charges. The aim of the scammers is to profit from your money, not to help you access or increase the value of your savings as they may claim.
How to spot a scam
Scams usually begin by you being unexpectedly contacted about your savings with an offer that sounds too good to be true. Look out for:
- Out of the blue phone calls, texts, emails, internet ads, or door to door calls by someone wanting to discuss your savings. Unrequested contact by phone, text or email to market pensions is illegal in the UK;
- Offers of a way to access your pension savings before you’re age 55, or encouraging you to move your savings elsewhere for a higher return;
- Offers to convert your pension to cash before age 55 (sometimes known as pension liberation) are usually scams as it’s not typically possible to access your pension before 55 unless you are seriously ill. These offers have serious tax implications as taking your pension early can result in paying up to 70% in tax on your savings;
- Offers to those over 55 to invest their savings in bogus schemes that promise higher than usual returns. You should always speak to an authorised and regulated financial services company or financial adviser before deciding what to do with your pension pot;
- Offers of a free pension review;
- Offers of loans, cashback, or advances on your savings;
- Aggressive or hurried sales techniques, such as offering incentives for quick decisions.
What to do if you think you’ve been approached by a scam
- Check if the person or company who contacted you is legitimate through the Financial Services Register or call the Financial Conduct Authority on 0800 111 6768.
- If you are contacted by someone claiming to be from a company you recognise, but you are unsure if it is legitimate, end the conversation, find the published telephone number of the company on the Financial Services Register and call them directly.
- Never give any personal or financial details if you have been unexpectedly contacted or are in any way unsure whether the company is legitimate.
- Check everything yourself; don’t be tempted to invest just because a friend or family member suggests it or reassures you that it’s safe.
- You will be receiving a number of communications from the Equitable this year. If you are concerned about whether any of these are genuine, call us on 0330 159 1530.
What to do if you suspect a scam
- Report to the Financial Conduct Authority on 0800 111 6768 or via their online reporting form.
- Report it to Action Fraud on 0300 123 2040
- If you’re worried that you’re in the process of being scammed in relation to your Equitable Life policy, call us immediately on 0330 159 1530.
Where to find out more
The FCA provides more information on pension and investment scams and how to protect yourself
0800 111 6768.
Cifas is a not-for-profit fraud prevention organisation that helps protect individuals and organisations against fraud
0330 100 0180.
The Pensions Advisory Service provides more information on pension and investment scams as well as general guidance
0800 011 3797.
Money Advice Service offers advice and guidance on all money-related matters, including investments
0800 138 7777.
Where can I go to get help and support?
We hope the Introduction to the Scheme booklet and the other documents that will be sent to you over the next few months will give you all the information that you need, however we appreciate that this is a complicated matter and you may need more assistance.
If the High Court permits us to go ahead, we will be launching a telephone guidance service. This service is there to help you make your decisions regarding the vote. More details of the service will be provided when the Decision Packs are issued.
|Additional Premium Rights||These are rights that some Scheme Policyholders have which entitle them to pay additional premiums into the With-Profits Fund.|
|Articles||The articles of association of the Equitable.|
|Brussels Recast Regulation||Regulation (EU) No 1215/2012 of the European Parliament and of the Council of 12 December 2012 on jurisdiction and the recognition and enforcement of judgments in civil and commercial matters.|
|Calculation Date||The date as at which certain values will be calculated to determine Uplift amounts, which is expected to be 30 September 2019.|
|Capital Distribution||Capital Distribution is an amount that is currently added to the Policy Value when a policy matures or a policyholder takes their benefits. For the vast majority of With-Profits Policies, we take the underlying value as at 31 December 2014 and allocate an extra Capital Distribution of £350 to every £1,000 (i.e. 35%) of that underlying value.|
|Change to the Articles||A special resolution proposing an amendment of the Equitable’s articles of association making Utmost the sole Member of the Equitable with effect from the Implementation Date, should the Scheme Policyholders vote in favour and the High Court approve the Scheme.|
|Class||A group of policyholders whose rights and the way the Scheme will affect them are sufficiently similar that all of them are able to consider and vote on the Scheme together.|
|Equitable (the)||The Equitable Life Assurance Society, a company incorporated in England and Wales with company number 00037038.|
|Explanatory Booklet||A document we will send out to Scheme Policyholders after the First Court Hearing and before the Policyholders’ Meeting, setting out full details of the Scheme.|
|Extraordinary General Meeting (EGM)||The extraordinary general meeting of the Equitable to be held in order for Members to vote on the Change to the Articles.|
|FCA||The Financial Conduct Authority|
|First Court Hearing||The High Court hearing to give directions in relation to the Scheme and the Transfer which is currently scheduled to take place on 22 July 2019.|
|GAR||Guaranteed annuity rate provided by certain policies held by a small number of Scheme Policyholders.|
|GMP||Guaranteed minimum pension provided by certain policies held by a small number of Scheme Policyholders.|
|High Court||The High Court of Justice in England and Wales|
If the Scheme Policyholders vote in favour of the Scheme, and the High Court approves the Scheme and the Transfer, the date on which
(a) the key aspects of the Scheme (Policy Values are uplifted, With-Profits Policies become Unit-Linked Policies, and Investment Guarantees are removed) would be implemented;
(b) the change to the Equitable’s Articles will become effective; and
(c) the Transfer will be implemented. This is expected to be 1 January 2020.
The Equitable’s obligation under a Scheme Policy to pay benefits determined by amounts which have been paid in premiums and when they were paid.
Investment Guarantees do not include benefits which are payable only on the occurrence of specified life events (such as death or survival, or being diagnosed with a particular medical condition, or undergoing specified hospital surgery).
Investment Guarantees do not include GARs or GMPs.
|Insurance Event Benefits||Policy benefits which are payable only on the occurrence of a specific life event of the person whose life is assured, such as death, survival, or the diagnosis of a particular medical condition.|
|Investment Choice Form||The form which Scheme Policyholders can use to choose unit-linked funds if the Scheme goes ahead.|
|Investment Choice Pack||Pack provided to Scheme Policyholders containing certain forms and documents, including the Investment Choice Form , which will help you to decide which unit-linked fund to invest in, and to tell us what decision you have made.|
|Legacy Scheme Policy||A policy that reaches its contractual maturity date between the date of Sanction Order and the Implementation Date, or a policy of a Scheme Policyholder who dies in this period.|
|Member||A member of the Equitable.|
|Non-Profit policy||Policies that are not With-Profits Policies or Unit-Linked Policies .|
|Policyholder Independent Expert||Trevor Jones of KPMG. Mr Jones has been appointed with the FCA’s approval, to consider whether the Scheme is in Scheme Policyholders’ interests and to prepare a report for the High Court.|
|Policyholders’ Meeting||The meeting of Scheme Policyholders that the Equitable will call, if the High Court gives permission at the First Court Hearing, at which Scheme Policyholders can vote on the Scheme.|
The main components of this sum are:
(a) the premiums paid in relation to that Scheme Policy;
(b) any deductions in accordance with relevant policy terms for expenses and charges; and
(c) an adjustment, determined by the Equitable, which reflects smoothed investment returns during the period that the relevant Scheme Policy has been held.
|PRA||The Prudential Regulation Authority|
|Primary Uplift||An amount which Scheme Policyholders receive and which represents their share of the assets that the Equitable is distributing under the Scheme. Scheme Policyholders will also receive a Secondary Uplift to reflect the residual value (if any) of any Investment Guarantees they have.|
|Proposal||The Equitable’s Proposal to allocate its assets to its with-profits policyholders through the Scheme, the Change to the Articles, and the Transfer.|
|Run-Off||A process by which an insurance company no longer enters into new policies, but continues to meet its obligations under existing policies.|
|Sanction Order||The order of the High Court approving the Scheme, which the Equitable intends to ask the High Court to make at the Second Court Hearing.|
The proposed Scheme of Arrangement between the Equitable and Scheme Policyholders under Part 26 of the Companies Act 2006.
As described in this booklet, the proposed Scheme is subject to approval by Scheme Policyholders and the High Court.
(a) a With-Profits Policy which is not governed by German law and which is in force on the Implementation Date;
(b) in relation to any person who is a member of the FSAVC Scheme on the Implementation Date, that person’s legal rights against and obligations to the Equitable as a result of their membership of the FSAVC Scheme; and
(c) any policy of the Equitable which is not governed by German law and which is in force on the Implementation Date and confers With-Profits Switching Rights .
|Scheme Policyholder||A person to whom the Equitable is required to make payments under a Scheme Policy.|
|Second Court Hearing||The High Court hearing of the Equitable’s application for an order that the Scheme be sanctioned, expected to take place in November 2019 at the Rolls Building, Royal Courts of Justice, 7 Rolls Building, Fetter Lane, London EC4A 1NL, UK.|
|Secondary Uplift||An amount, equal to or greater than zero, which reflects the residual value of Scheme Policyholders’ Investment Guarantees once the Primary Uplift has been allocated to their Policy Value. The value of the Investment Guarantee is calculated using standard actuarial techniques as at the Calculation Date. This value is then increased if required to ensure that policies meet certain fairness conditions at the Calculation Date and that policies providing retirement benefits do not receive less than they would if they were a year older.|
The transfer of the Transferring Business from the Equitable to Utmost. This will take place by way of a Part VII Transfer.
A “Part VII transfer” is the name sometimes given to a transfer of insurance business under Part VII of the Financial Services and Markets Act 2000. It is a statutory scheme whereby the liabilities of one insurer and corresponding assets are transferred to another insurer. The process that must be followed is stringent to ensure that Policyholders are protected. To be effective, the Transfer is required to be sanctioned by the High Court.
In considering a Part VII transfer, the High Court will take into account the views of the PRA, the FCA and the Transfer Independent Expert, whose appointment must be approved by the PRA in consultation with the FCA, and any objections made by affected parties such as Policyholders and reinsurers.
|Transferring Business||The entirety of the business of the Equitable to be transferred to Utmost under the Transfer.|
|Unit-Linked Policy||A policy, which is not a With-Profits Policy, under which amounts that are payable to policyholders are determined by the price of units in a unit-linked fund.|
|Uplift||The increase to the Policy Value of each Scheme Policy to be implemented under the Scheme made up of the Primary Uplift and the Secondary Uplift.|
|Utmost||Utmost Life and Pensions Limited, a company incorporated in England and Wales with company number 10559664 (formerly known as Reliance Life Ltd). Their website is: www.utmost.co.uk.|
|Voting Forms||The voting form which Scheme Policyholders who are entitled to vote on the Scheme can use to appoint a proxy for the Policyholders’ Meeting and Members can use to appoint a proxy for the EGM.|
|Voting Value||The value of a Scheme Policyholder’s claim against the Equitable as at 1 April 2019, as indicated on the preprinted voting form that Scheme Policyholders will receive in the summer.|
|With-Profits Fund||The Equitable’s With-Profits Fund.|
A policy which entitles its holder to participate in the Equitable’s profits.
Such policies include any Unit-Linked Policy to the extent that With-Profits Switching Rights were exercised under it on or before 31 December 2017 and its holder had an entitlement to participate in the Equitable’s profits on that date.
|With-Profits Switching Rights||The right to invest in the With-Profits Fund by making a premium payment or a switch of investments into the With-Profits Fund.|