Which?, the consumer group, on Monday attacked the Financial Services Authority after the regulator backtracked on proposals to prevent life assurers from dipping into the surpluses in their life funds to meet the costs of mis-selling policies.

Which? chief executive Peter Vicary-Smith, said: “The FSA has, once again, left policyholders in the lurch and sided with the financial services industry. The regulator repeatedly shows it’s unwilling to stand up for the interests of with-profits policyholders.”