The SIB initiative came as the Personal Investment Authority, the frontline regulator responsible for ensuring the review is carried out, formally admitted that barely 24,000 cases had been assessed of the 446,000 identified as priorities.
Only 6,227 people have been offered redress, worth a total of pounds 50m. Of the 58,000 priority cases identified by independent financial advisers, redress has been offered to 561 and accepted by 99.
Joe Palmer, chairman of the PIA, said: "The measures outlined today should enable firms to increase their rate of progress significantly. PIA will be concentrating its attention on those firms with the most to do."
The SIB initiative is aimed at clearing a serious information log-jam, which insurers claim has prevented them from assessing the losses incurred by the vast bulk of cases so far identified.
Until now, pension providers have relied on a questionnaire jointly devised by the Association of British Insurers (ABI) and the National Association of Pension Funds (NAPF), the insurers' and pension schemes trade bodies.
However, both sides have complained that the questions were far too detailed and involved their staff in a meaningless statistical exercise.
SIB's paper says that insurers can now make rough calculations based on a pension scheme's information booklet, plus simple additional information. Instead of asking 200 questions, insurers will now have to ask only eight.
The regulator claimed that, while not totally accurate, the new system, devised by accountancy firm Price Waterhouse, was not biased towards life companies or policyholders. A separate validation by consultants Lane Clark & Peacock backs SIB's assertion.
The proposals were welcomed by the NAPF and the ABI as an important contribution to resolving the mis-selling scandal, more than two years after a review identified the problem. The British Bankers' Association, many of whose members have sold personal pensions, also backed the SIB plan.
However, both Legal & General and Chambers Townsend Consultancy, a provider of pension redress systems to life companies, warned reinstatement would still pose a problem even after estimates of actual losses were made. Pension schemes were likely to require far more detailed information before readmitting former members, it was claimed.
If so, the log-jam would break only to reassemble a few months down the line while increasing pressure on the regulator to opt for a top-up to the personal pension instead, it was claimed.
Another big worry concerned the regulator's decision to force policyholders into becoming more involved in the compensation process than hitherto.Reuse content