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Growing list of the wounded

Darwinism is the order of the day as the bear market claims another victim with the closure of Pearl to new business.

Pearl is unlikely to be the last. Several insurers and fund managers such as those with a heavy reliance on split-cap trusts can only be described as walking wounded. There is surely little hope that any of those facing a liability due to foolishly promised guarantees or threatened with compensation claims will find a buyer to rescue them from their woes.

The strongest houses are looking stronger by the day, even if only in comparison with the rest.

The second major news of the week sees Abbey National signing up Prudential as its with-profits provider in an embryonic multi-tie. The move must lead IFAs to ask all manner of questions about the bank&#39s faith in Scottish Mutual, which also has a with-profits offering.

But what can be learned about the future landscape? Well, nobody will win a prize for saying there will be fewer fund managers and insurers.

As for distribution, the Pearl closure leaves a question mark over its direct salesforce and the whole concept of lower-level advice. AMP could well go IFA by default.

The Pru deal points to the increase in bank-based distribution. The banks look set to emerge as IFAs&#39 main rivals post-depolarisation.

As questions are raised over the future of salesforces, which might have been able to reach the much talked about financially excluded, what is the Government doing to help? It is planning a range of price-capped products that will pile on the misery and make the situation worse.

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