E&Y had lost the confidence of some Equitable members who feel they have been let down by the auditors.
The firm has been forced to defend its role in the Equitable crisis, having come under fire for giving the insurer a clean audit report despite the uncertainty over a House of Lords ruling which in December forced it to stop writing new business.
Equitable earlier this week said it would consider taking legal action against organisations or individuals found to have acted negligently in their dealings with the troubled insurer.
But Equitable said that to date there was no evidence that E&Y had done anything wrong in its work for the company.
A spokesman for E&Y said: ‘What we want to do is to give a clear signal that changes are taking place at Equitable and help our client move forward with its new plans unhindered.’
But he said the firm would stand by the quality of its work, which has also come under scrutiny from the ICAEW and policyholders.
A spokesman for Equitable Life confirmed E&Y was to quit and that PwC’s appointment would be put to the company’s annual general meeting in May.
The firm’s 1999 audit fee for the Equitable Group was Pounds 478,411. It also earned Pounds 1.14m in non-audit services.
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