View more on these topics

Protection business slumps in price war

Highclere Financial Services partner Alan Lakey is concerned over the slump in protection sales in the first half of this year.

He has voiced concerns about a possible widening of the protection gap as insurers’ interim results reveal widespread falls in protection business.

Standard Life saw sales fall by 50 per cent and Prudential’s business was down by 33 per cent compared with the first half of 2006 and Aviva’s sales dropped by 23 per cent.

Companies which did report rising sales have seen only small increases. Market leader Legal & General’s sales were up by 5 per cent, Aegon Scottish Equitable business rose by by 2 per cent and Friends Provident saw a 1 per cent rise. Bright Grey bucked the trend with a 24 per cent increase.

Lakey says: “These figures are scary. I think that Standard Life, in particular, is lacking focus in protection and that, in a flat market, product providers need to be at the top of their game.”

Standard Life spokesman Barry Cameron says: “The market was quite subdued in the first half, forcing even greater price competition, which is not something that we are interested in getting involved in.”

Aviva also says fierce price competition contributed to poor sales but Prudential claims its focus has been on its joint venture with Discovery and developing its flexible protection Plan for a September relaunch rather than pushing sales.

Friends Provident says rising interest rates starting to filter into the property market significantly contributed to the stale protection market and Legal & General believes this will only worsen in the second half of this year.


Pru launches factory-gate priced model

Prudential has launched a factory-gate priced remuneration model to its investment portfolio after research showed 65 per cent of advisers believe the model will ensure greater transparency.

A third of FSA enforcement staff to leave due to move to principles

Nearly a third of the staff in the FSA’s enforcement division are to leave this year either through redundancy or being moved to another department, with new blood on its way.The FSA says the enforcement division’s new team and structure will be in place by the end of November with a 20 per cent net […]

Axa fears life firms writing cheques to win new business

Axa says it is increasingly concerned that life companies are “just writing cheques to each other” to win new business.Executive director Paul Evans says that although the industry is seeing sustained growth in personal pension business, surrender levels remain stubbornly high, resulting in a lot of money simply washing round the industry.Axa’s first-half life and […]

Annuities reach four-year high

Annuity rates have reached their highest level for four years but further rises depend on movements in bond yields, says Annuity Direct managing director Stuart Bayliss.He says improvements in annuity rates are due to a substantial increase in long-term gilt and bond yields and the last six months have seen a succession of rises as […]


News and expert analysis straight to your inbox

Sign up


    Leave a comment


    Why register with Money Marketing ?

    Providing trusted insight for professional advisers. Since 1985 Money Marketing has helped promote and analyse the financial adviser community in the UK and continues to be the trusted industry brand for independent insight and advice.

    News & analysis delivered directly to your inbox
    Register today to receive our range of news alerts including daily and weekly briefings

    Money Marketing Events
    Be the first to hear about our industry leading conferences, awards, roundtables and more.

    Research and insight
    Take part in and see the results of Money Marketing's flagship investigations into industry trends.

    Have your say
    Only registered users can post comments. As the voice of the adviser community, our content generates robust debate. Sign up today and make your voice heard.

    Register now

    Having problems?

    Contact us on +44 (0)20 7292 3712

    Lines are open Monday to Friday 9:00am -5.00pm