Prudential is cracking down on salesmen with poor persistency rates by clawing back commission on policies that lapse in the first two years.
Salesmen will lose all commission on policies which lapse within six months. They will also lose a proportion of commission if policies lapse within 24 months.
Pru did not publish a breakdown of its persistency rates in the PIA's annual persistency report two weeks ago. The company is regulated by the FSA and is not required to give full details to the PIA.
But Pru has revealed that its salesmen had a persistency rate of 90 per cent after one year for regular-premium personal pensions sold in 1985. This compares with an industry average of 86.5 per cent.
For policies sold in 1993, the persistency rate after three years is 76 per cent against an industry average of 66 per cent.