First quarter results skewed by large cleint pension gain reported last year
Scottish Life has reported a 12 per cent drop in first quarter new pension business.
New pension business at the Edinburgh insurer, part of Royal London Group, dropped to £524 million from £542 million the previous quarter.
Year-on-year, new business fell by 11 per cent, though 2011 first quarter figures were lifted by gains from one large pension scheme.
Stripping out the gain from that one scheme, underlying growth was up 16 per cent this year though individual pension new business is down 27 per cent on last year.
Parent company Royal London said Scottish Life new business in the first quarter of 2012 was 82 per cent higher than the first quarter of 2010.
Scottish Provident and Bright Grey reported a 45 per cent increase in new business in the first quarter to £107 million, largely on the back of a successful campaign to push their protection business to independent financial advisors.
Royal London said: “Looking forward, the implementation of the EU Gender Directive in December 2012 means that the cost of protection plans has to be the same for men and women.
“The result is that costs will increase for women and both brands are highlighting the advantages to women of starting, or increasing, protection cover before the costs rise.”
Royal London has reported a 10 per cent decline in its new life and pensions business in the first quarter to £761 million from £843 million in the first quarter of last year.
Royal London 360° new business fell by 23 per cent to £90 million in the first quarter.
Royal London said “difficult market conditions” had led to the overall slump in new business.
The group's asset management division saw net outflows rise to £495 million compared to £113 million at the same point last year.
Group chief executive Phil Loney said: “Market conditions generally remain uncertain and difficult in 2012, with some growth in group pensions; individual pensions slowing; and the protection market flat.
"Against this background, our protection businesses have delivered excellent performance, the reward for a lot of hard groundwork over the past couple of years.
“Group pensions new business was once again good, though with a very strong prior year comparator, which included one very large scheme.
“Overall, our expectation is that we will have broadly maintained market share in pensions.”