EQUITABLE Life, the embattled insurer, said last night that its computers would take up to two months to deliver valuations for policyholders wishing to move their pensions.

The delay is a further blow to one million customers who last week saw their pension values cut by 16%, and who this week have been inundating financial advisers with calls requesting policy values with a view to switching their funds elsewhere.

Alan Steel, the respected West Lothian-based financial adviser, said: "We are being told by Equitable Life that it is a minimum six weeks before they can get their computers to work and give any valuations or penalties. Everybody knows that computers can't be locked for six weeks, so we think it is a ploy to stop people taking their money out."

Shaun McCabe, an adviser with Bristol-based Chartwell, said: "Their customer service centres are saying it will be September before they are able to give valuations, though we were promised a response within seven days for a client who definitely wanted to exit."

An Equitable Life spokesman, Alastair Dunbar, said: "We have got a big change in our values and it takes time to get the systems to cope. Most of the delay is in testing to make sure we have got everything absolutely right."

He said letters giving general indications of policy values would go out to members next week but individual statements would not be ready until "September or October".

Paul Braithwaite, chairman of the Equitable Members Action Group, said: "This is an atrocious administrative meltdown which is indefensible. The Treasury should now step in and grasp the nettle. Equitable is on the slide and it isn't going to get better. What we have already is one million deeply disillusioned middle-class professionals who are revisiting their thoughts on pensions."

He said the present crisis had all the makings of "a quiet run on the company".

Mr Steel echoed his fears: "Unless the FSA (Financial Services Authority) stands up and makes some determined promise, I think panic is going to set in."

However, Alan Steven, pensions specialist at Portfolio & Pension Management of Hamilton, said it would take a massive outflow of funds to destabilise the insurer, which was unlikely. "I think the new management team wants to make an impact and the worst is probably over."

Despite this optimism, Mr Braithwaite said: "The new chairman promised everything would be transparent and here we are months later with absolutely no information." He said professional members of the action group had estimated that only 6% of the 16% cut in policies could be blamed on the fall in world stock markets, and there could be further nasty surprises.

New owner, the Halifax, has pinned its hopes on securing agreement between the Equitable's two groups of policyholders, guaranteed and non- guaranteed, on how much can be paid out to the guaranteed holders who successfully took the insurer to the Court of Appeal last year.

A further potential black hole is mis-selling liabilities. Equitable is due to publish its own report next month on whether non-guaranteed holders were all mis-sold their policies from 1988 onwards. In the meantime, say advisers, the 20,000 or so members who were sold a policy after the court case of January 2000 have an almost indisputable case against Equitable.

- July 25th

The Herald

-- Anonymous, July 25, 2001