BlackRock to manage Equitable Life's £5.7 billion fund

Equitable Life today handed the lucrative job of managing its £5.7 billion fund to BlackRock, breaking a decade-long relationship with Insight Investment.

BlackRock will take over management of assets for the society's 400,000 policyholders and group plan members in October.

Equitable members are demanding Government compensation for losses incurred from the near-collapse of the insurer in 2000.

Chief executive Chris Wiscarson today said: "Our two main paths of work are maximising returns and working with Government to secure the best compensation possible for policyholders."

He told Bloomberg that management fees to BlackRock would be about £7 million — similar to those paid to Insight last year.

Most of the fund's assets are linked to pension policies and held in fixed-income securities, including corporate bonds and gilts.

That low-risk strategy will not change under the move to BlackRock, Wiscarson said.

Equitable policyholders won a compensation pledge from the new Government in May.

They are claiming compensation after the society cut payouts to more than 1 million customers after losses mounted from unsuccessful investments and guarantees on policies.

It stopped taking new business in December 2000.