Equitable ready to decide on future this year

LONDON (Reuters) - Closed insurer Equitable Life will decide over the next 12 months whether to pursue a standalone future or find a buyer, it said, with its solvency levels now appropriate for a firm winding down its business.

Excess realistic assets -- a key measure of financial solvency -- stood at 621 million pounds at the end of December, down from 884 million, after the transfer of with-profits annuities to insurer Prudential.

Equitable, which closed to new business after it almost collapsed in 2000, said it now had a "stable and secure" future, following other deals completed in 2007 to slash its risk profile, including the transfer of most of its fixed pensions to Canada Life, a unit of Great West Lifeco, and of University Life Assurance Society to Reliance Mutual.

"It is from this position of relative strength and security that we are about to invite third parties to approach us with proposals which could improve the prospects for policyholders," the insurer said in its preliminary results.

"During 2008, we expect to be able to determine whether the next phase of the society's future will be best for policyholders if we continue independently, or whether one or more third parties can produce the prospect of better outcomes for policyholders."

Any change, it said, would be implemented in 2009.

Britain's oldest mutual insurer also said the parliamentary ombudsman was due to release the expected date for the publication of a reopened independent inquiry into Equitable Life next month.

The report, which could recommend government compensation for Equitable policyholders, is expected in the summer.