£10m mis-selling fight for Equitable

EQUITABLE Life faces a bill for £10 million if it loses a legal fight with angry former members. The Equitable Late Joiners' Action Group (Eljag) has hired a City law firm to sue the crisis-hit life insurer.

Eljag's 125 members took out Equitable policies after 30 September, 1998, and claim the society was aware by then that it was in trouble.

They quit before this year's survival vote, so they can seek legal redress for alleged misselling. Members who stayed gave up their right to sue when they voted on the compromise deal over guaranteed annuities that saved Equitable. Eljag vicechairman Paul Weir insisted: 'Our case is bomb-proof.'

Equitable said: 'We will fight claims we believe are invalid. Policyholders would have to pay for any compensation.'

Financial Mail revealed last week that Equitable, chaired by top City lawyer Vanni Treves, was facing a wave of writs from policyholders fed up waiting for it to deal with their complaints.