Equitable Life, the British mutual insurer that nearly collapsed a decade ago, has urged the government to fully reimburse policyholders for their losses rather than cap compensation payments as proposed.

Compensation should be based on an estimated loss of between £4 and £4.8bn ($7.42bn) and should not be subject to a £400m cap proposed in an independent review in July, Equitable Life said.

Britain’s Conservative-led coalition government plans to set out its plans to compensate Equitable Life policyholders as part of a wider review of government spending scheduled for October 20.

The coalition has said it aims to implement a 2008 report by the parliamentary ombudsman which blamed Equitable Life’s near-collapse in part on “serial regulatory failure,” and recommended that policyholders receive compensation from the public purse.

Equitable Life, Britain’s oldest insurer with 1.5 million customers at its peak, came close to collapse after it was forced to honour unsustainable guarantees stretching back 30 years.

It eventually closed to new business, affecting more than a million people who had placed retirement savings with the society.