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Standard plea over net business figures

Standard Life chief executive Trevor Matthews has called on pension providers to publish net business figures in their company results.

The rallying cry comes as the industry faces criticism about churning and a misleading focus on new business figures.

Matthews says he has been lobbying for insurers to publish the amount of business they lose on an annualised premium equivalent basis alongside new business figures.

Matthews says: “Providers need to make the level of funds coming in and out clearer. We are lobbying for this and I believe it will happen next year.”

Money Marketing understands that there is growing support for the move on the ABI’s distribution regulatory committee but the ABI says it has only held preliminary discussions and a spokesman indicates it is unlikely to support the measures at present.

Last month, FSA chairman Sir Callum McCarthy slammed the pension industry for paying high commission to win new business when persist-ency rates are so low.

Analyst Ned Cazalet says insurers’ buoyant half-year new business figures are “meaningless” unless the amount of business lost is revealed.

An ABI spokesman says: “We publish lapsed pension business across the industry. It is meaningless to know one firm lost 50m to another but also gained 50m from the same firm.”

Scottish Equitable spokeswoman Lesley McPherson says: “We fully support publishing net figures in principle and want to move away from the current situation.”

But a Norwich Union spokesman says: “We are already very clear about our lapsed business and have no plans for further disclosure. We revealed we set aside 130m for lapsed business at the end of last year and disclosed we have used 40m of that in the latest half year results.”

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