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Gauntlet thrown down after Nationwide says price cap is affordable

Scottish Life International is launching a life insurance product in the Lebanon.

Approval for its protected lifestyle product has been obtained from the Ministry of Economy and Commerce of Lebanon. A branch of SLI is now operational in Beirut.

The protected lifestyle product incorporates optional protection benefits to provide financial security in the event of death or serious illness. The regular-premium unit-linked contract offers a wide range of investment funds and is available on a whole-of-life or fixed-term basis. It can be personal or business-related protection.

Chief executive Mike Hicks says: “The unique features of the protected lifestyle Lebanon contract and the capital-protected investment funds we have created are ideal for our core customers in Lebanon and the Middle East – the professional person looking to protect and plan for their family or business and build or protect their wealth.”

Towry Law international director Tony Shah says: “Any expansion into the Middle East is always good news.”

Nationwide Building Society has told Government ministers it can afford to sell the Sandler suite of products within the 1 per cent price cap, prompting the Treasury to challenge other providers to do the same.

The comments came at a private meeting at 11 Downing Street two weeks ago attended by Treasury financial secretary Ruth Kelly, Government officials, providers, trade bodies and consumer groups.

Nationwide investment group managing director Clive Parkinson said as long as the sales regime was appropriate, the society could afford to sell the Sandler suite within the 1 per cent price cap.

Kelly then turned to the other providers present and challenged them to follow Nationwide&#39s lead.

The exchange has raised fears that the Treasury may follow the advice of a small number of providers, as it initially did when designing stakeholder pensions, and extend the price cap.

Parkinson says that by an appropriate sales regime, he meant competent but not FPC3-qualified branch representatives selling products in under half an hour. He says: “We would consider playing as low as 1 per cent provided we get the right sales process and this is the message I told the Treasury at the meeting.”

Aegon corporate development director Laurie Edmans says: “I can only hope consultants B&W Deloitte will gut these assumptions in its analysis of the price cap for the Treasury.”

The Treasury says it will not comment on private meetings.

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