Legislation paving the way for compensation to be paid to Equitable Life policyholders has cleared Parliament.
Last month the government announced that 1.5 million policyholders who lost money in the firm's near collapse in 1999 would share £1.5bn tax-free compensation.
The Bill, which had already been approved by MPs, cleared the Lords on Wednesday without a vote and is now set to become law.
Treasury minister Lord Sassoon, introducing the Equitable Life (Payments) Bill to the House of Lords, said: "The government does take the maladministration of Equitable Life very seriously.
"We have shown that resolving this issue is a real priority of the government and have taken the necessary action to reach a fair and swift resolution."
UKIP peer and an Equitable Life policyholder Lord Willoughby de Broke raised the plight of people who took out policies before 1992.
"It is worse for them because they are older and they have no other means of support than their pension payments," he said.
Lord Sassoon said that those people had taken out policies "before any maladministration could have affected their decision".
He added that the pre-1992 policies had paid out more than they should have done in the early years, outweighing the subsequent lower-than-expected payments.
Labour peer Lord McKenzie of Luton welcomed the main thrust of the government's approach to the issue.
He said: "This has been a long and arduous journey for those who lost out from regulator failure and I fear for some the journey is not yet at an end, but the government are entitled to be given credit for the determined manner in which they have taken this forward."
The bill was also welcomed by Lib Dem peer Lord Kirkwood of Kirkhope, who told peers: "It is a complete and total tragedy from beginning to end.
"It has ruined the prospective retirement prospects for thousands and thousands of our citizens and it must never be allowed to happen again."
Equitable Life, one of the UK's leading private pension companies, closed to new business in 2000 and subsequently came close to collapse.
Parliamentary Ombudsman Ann Abraham found ten instances of maladministration by regulators and Whitehall officials in the period leading up to December 2001.
Dods Parliamentary Communications Ltd