The Association of British Insurers has published new research looking at factors affecting life offices' surpluses.
The research paper 'Actuarial surplus determination in life insurance firms: United Kingdom evidence' was conducted by Dr Mike Adams of the School of Management at the University of Bath and by Professor Philip Hardwick of Bournemouth University's Department of Accounting and Finance.
The research focused on four main factors affecting life insurers' surpluses. These surpluses are their assets minus long term policy liabilities.
The four factors were, company size, leverage, product range and company structure.
It found the larger life companies tended to report higher surpluses than smaller firms.
In terms of leverage, that is where loans play an important role in the company's capital structure, those firms with higher leverage had smaller surpluses.
Those companies with a greater variety to their product range were likely to report higher surpluses than those with a narrower product range.
Finally for company structure the researchers found this went against expectations, finding mutual life offices tended to report higher annual surpluses than propriety insurers.