Some 370,867 policyholders had received payouts by the end of January, and payments to all the individuals who can be traced are on track to be completed by April as planned, Economic Secretary to the Treasury Sajid Javid said.
Nearly 80% of eligible people who bought a policy directly from Equitable Life have received compensation, with £535 million paid out so far, the Government said.
However, the compensation scheme which was set up by the Government has not been able to track down everyone who would be due for a payment despite searches of the electoral roll and credit histories. It plans to provide further detail on the volume of untraced policyholders in future updates.
In a written ministerial statement, Mr Javid said there are also "additional complexities" in trying to trace people who bought their policy through a company scheme.
The Equitable Life Payment Scheme has written to the trustees of all 5,700 eligible company schemes. As a result of this work, payments to some 500,000 policyholders will accelerate from April, the Government said. It was also confirmed that a total of £9 million has been paid to the estates of 5,760 deceased policyholders and others are continuing to be contacted.
Mr Javid said: "The Government is committed to drawing a line under the Equitable Life issue and the scheme remains on track to close as planned in 2014."
A pot of £1.5 billion has been put aside to compensate policyholders, and payments started in June 2011. An update issued by the Government last year revealed the majority of Equitable Life policyholders will receive less than one quarter of the money they lost.
It has been estimated that policyholders at Equitable Life have lost £4.3 billion compared with if they had held their money with another institution.
Equitable Life was brought to its knees in 2000 when it lost a legal battle in the House of Lords over the rights of policyholders, forcing it to close to new business. The Parliamentary Ombudsman called for policyholders to be paid compensation after finding 10 instances of maladministration by regulators and Whitehall officials in relation to Equitable in the period leading up to December 2001.
Paul Weir, spokesman for the Equitable Members Action Group, said that the body is fielding hundreds of inquiries from elderly people who are worried that they have still not been contacted about their compensation. He said that the handling of customer complaints so far has been "abysmal" and said that policyholders are being met with a "wall of obstruction".