Prudential has added £2.7bn to its with-profits policy values and will increase the majority of annual bonus rates in 2008.
In its bonus declaration released today, Prudential says its life fund has delivered an investment return of 91 per cent over five years and 134 per cent over 10 years.
The performance in 2007 was 7.2 per cent and the life office says all endowments will meet repayment targets in 2008 as they have done in all previous years.
The £2.7bn added to with-profits policy values is split with £1.2bn to be paid in annual bonuses and £1.5bn in terminal bonuses.
Total retail with-profits sales in 2007 rose 21 per cent to £2.3bn compared to 2006 while with-profits bond sales increased by 59 per cent in 2007.
Prudential managing director of retail life and pensions Gary Shaughnessy says: “We have seen a surge in with-profits sales as more and more investors choose Prudential’s with-profits to protect themselves during volatile and
uncertain conditions as well as during market growth.
“Successful risk management and asset allocation by the Prudential Portfolio Management Group, our in-house fund managers, has been a key driver in helping to protect the fund and lock in value to produce consistently strong returns that are in excess of most other with-profits funds, thereby
delivering improved prospects for our policyholders over the longer-term.
“They have made a number of significant strategic calls over recent years including the decision to de-risk the corporate bond portfolio within the fund prior to the market turbulence experienced since the middle of last year.”