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Five cut rates in protection price war

Five leading protection providers have cut their rates as the price war hots up.

Legal & General, Scottish Provident, Scottish Equitable, Axa and Bright Grey have all reduced premiums. Axa has sliced rates by up to 7 per cent across almost half its guaranteed life and critical-illness range.

Highclere Financial Services partner Alan Lakey says the big-name providers are constantly battling for the top spot on The Exchange’s best-buy tables and he expects the repricing to conti- nue indefinitely.

But Prudential head of development propositions Paul Cowman says: “These are retaliatory reprices. We seem to see no activity for four weeks and then one provider will cut their rates and everyone plays follow the leader. I am not sure how much longer this can go on.”

Aegon Scottish Equitable head of marketing protection Rod McKie says: “You would think there would be a breaking point at some stage. There is oversupply in the marketplace at the moment which is a contributing factor to these rate changes.”

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