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Bond boom sends NU’s sales soaring

Norwich Union saw its with-profits sales rocket last with new business increasing by 38 per cent to 1,208m, from 878m in 2006.

Total UK sales including investments were up by 6 per cent to 14.4bn from 13.6bn in 2006. Total worldwide sales rose 2by 5 per cent to 38.6bn from 30.7bn.

But NU had to revise its assumptions for the flooding last summer by adding 75m to its original 340m estimate to pay for claims.

UK life and pension sales were up by 5 per cent to 11.6bn from 11.1bn while investment business increased by 12 per cent to 2.7bn from 2.4bn. Individual pension business fell by 10 per cent to 3.3bn from 3.6bn, which NU says is due to the waning A-Day effect. Protection sales fell by 14 per cent to 879m from 1bn.

Overall bond sales were up by 17 per cent to 4.1bn from 3.6bn while sales of unit-linked offshore bonds more than doubled to 280m from 135m.

NU Life chief executive Mark Hodges says: “It was a very good year for bonds , both for our with-profits bonds and in doubling sales of our offshore bonds.

“We also had a good year on annuities and have written some bulk purchase annuity business. I predict it will be a tough year ahead for protection, collectives due to property fund values falling and bonds due to the capital gains tax uncertainties.”

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