Sales surged for the second year running, reflecting the continuing recovery in investor confidence which is also driving the housing market.
L&G's Election PEP, launched just before the general election in May, brought in pounds 207m and exceeded all expectations, David Prosser, chief executive, said yesterday. It was mainly responsible for increasing sales of PEPs and unit trusts from pounds 124m to pounds 443m in the first six months of the year.
A new, improved life bond would be launched shortly to try and maintain the momentum of sales in the second half of the year, Mr Prosser said.
Premium income from L&G's insurance-linked products rose 49 per cent to pounds 140m, new pension business from regular savings was 27 per cent higher than in the previous year and single-premium business, which tends to be more cyclical, grew by 91 per cent.
Income from company pension schemes was down slightly but this was almost exactly explained by a single annuity contract worth pounds 148m in 1996.
Even mortgage-related business grew, but by a more modest 9 per cent, while the amount of new pension money under management rose by 14 per cent to pounds 2.28bn, benefiting from the success of L&G's use of funds which track the FTSE index..
Prudential's group chief executive, Sir Peter Davis, who personifies the revamped Man from the Pru in the group's media advertising programme launched in February, announced a strong rise in business for the first half of the year.
World-wide single-premium business rose by 23 per cent, against 36 per cent in the first half of 1996 and a drop of 10 per cent in 1995. Regular premiums rose by 20 per cent world-wide in the first half of 1997, against 18 per cent in 1996 and a drop of 11 per cent in 1995.
In the US single-premium sales rose by 27 per cent and regular-premium sales were up 22 per cent. "This was an excellent set of sales figures. We are continuing to enjoy sales growth in all our major operations around the world," Sir Peter said.
Prudential's star product in the UK was once again its with-profits single- premium Prudence Bond, which brought in pounds 539m, an increase of 47 per cent on the first half of last year.
Single-premium business in the UK rose by 15 per cent to pounds 1.8bn, including a 12 per cent rise in pension business and a 29 per cent rise in life business, while PEP sales doubled to pounds 141m. Regular-premium business also grew by 15 per cent to pounds 182m.
Prudential's direct sales force grew sales of single-premium business by 12 per cent and regular-premium business by 15 per cent and doubled sales of investment products. Sales through independent financial advisers recorded a rise of 18 per cent in single premiums and 19 per cent in the small amount of regular-premium business.
Britannic Assurance reported levels of new business roughly similar to 1996, in spite of the restructuring of the sales force and the closure of 60 branches at the beginning of May.
Scottish Equitable reported a 42 per cent rise in new regular-premium incomes and a 5 per cent fall in single-premium business from last year's record levels.