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Pru is set to slash range to focus on profitable clients

Prudential intends to scale back dramatically on the number of its products and focus its marketing efforts on what it claims are profitable client segments.

The company will simplify its product range from its current 770 products to develop a simpler range in four areas – annuities, bonds, group pensions and Isas – which will be its core business by 2005.

Speaking at the Ernst & Young Financial Services Summit in Edinburgh, Prudential UK & Europe chief executive Mark Wood said tight margins mean the provider is only interested in individual new business from people aged 45 to 74 with assets over £10,000.

Wood said it will also aim at big corporations with more than 2,000 employees and form partnerships with bancassurers with nationwide branch networks.

He said the company anticipates its biggest area of growth in new business to be in the Far East, where developing companies are seeing life and pension business grow at the same rate as the overall economy.

Wood said: “The regulatory changes that face the market mean we will move to a market where independent advisers will be advising from a narrower range of products and consumers will get a more restricted choice.”

Sharing the platform with Wood, Morgan Stanley chairman Sir Brian Pitman said: “Cross-subsidising was fine when we all made piles of money. Now you have to get rid of unprofitable business.”

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