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Major life offices are riding out the long slide, says FSA

The FSA insists that no big UK life offices have breached solvency requirements, despite an unprecedented 11 consecutive days of stockmarket falls which have seen the FTSE 100 drop by 10 per cent in the last fortnight.

However, the regulator refused to be drawn on smaller life offices&#39 solvency. It claims the majority of the consumer market falls within the remit of the top 20 life offices.

Three weeks ago, outgoing FSA chairman Howard Davies said life offices could survive a drop in the FTSE100 to 3,500 – a level reached in the last week, and possibly even 3,000, although the regulator could never provide a guarantee that there would be no failures.

During the recent record run of market falls, which was finally stemmed on Tuesday, life offices were again the main sellers of equities as they aimed to balance their books but the regulator says no life office has reported a breach.

FSA spokeswoman Kate Burns says life companies have sold between £20bn and £25bn in equities over the last 18 months, reducing the average percentage of equities in their portfolios to between 35 and 37 per cent from the traditional level of around 75 per cent.

She says around £30bn in with-profits funds have closed to new business over the last year.

Burns says: “What we have said is that no large life insurers have had to come to us yet saying that they had breached the minimum solvency requirements.”


Fidelity warning over top-up fees

The plans for top-up university fees mean that parents and grandparents should start saving for children&#39s education, says Fidelity. At present, only 6 per cent of 35-54-year-olds investing in an Isa are saving for future education for their children, according to research commissioned by Fidelity. Only 2 per cent of people of grandparent age are […]

Key facts will feature generic illustrations

Generic illustrations will replace personalised illustrations in the FSA&#39s forthcoming key facts point of sales documentation except for pen- sions which must still provide an example of what each individual can expect to get back. A draft consultation paper seen by Money Marketing shows the FSA wants to introduce a streamlined and standardised approach to […]

Index tracking

Should all house price indices be rejigged following Halifax&#39s admission that it has been overestimating the number of houses with garages, which pushed up its figure on house price growth last year? Bolton: How each house price index is structured is entirely down to who operates it. Halifax took the decision to restructure its house […]

Henderson Global Investors – Global Fixed Income Absolute Return Fund

Wednesday, 29 January 2003 Type: Hedge fund Aim: Growth by investing in fixed income securities Minimum investment: Lump sum $100,000 Place of Registration: Cayman Islands Investment spilt: 100% in fixed interest securities Charges: Annual 1.5% Commission: Initial up to 3% Tel: 0800 881144


Natixis Global Asset Management’s quarterly Portfolio Barometer offers insights into UK financial advisers’ model portfolios and the allocation decisions they are making. Natixis’s Portfolio Research & Consulting Group works with financial advisers and other intermediaries to analyse and enhance their model portfolios and help them develop investor portfolios suited to today’s complex markets. The Portfolio […]


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