ScotAm brand facing the chop by Prudential

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The Independent Online

Prudential may scrap the Scottish Amicable brand as part of a radical shake-up of its UK operations to be announced next week.

There is mounting speculation that the conclusions of the review will include replacing the 175-year-old ScotAm brand with the Prudential name for all of the group's life and pensions products. Prudential bought Scottish Amicable in 1997 for £2.75bn.

Prudential began a three-month project to overhaul its business in this country after Mark "Chopper" Wood joined in June from the rival insurer Axa to head up Prudential in the UK. ScotAm, which manages the savings and investments of about two million people, is thought to be on his hit list following a significant decline in the company's new business.

This has been hastened by decisions by Prudential to disband ScotAm's direct sales force in August, leaving the business reliant on independent financial advisers. At the same time Prudential said it would no longer pay commissions up front to IFAs on ScotAm products.

One senior employee of another pensions company said: "We don't come across ScotAm when we are pitching for business now and it seems that their share of the pensions market has dwindled to that of a niche player."

Prudential took ScotAm on to bolster its presence in the IFA market, as sales of its own brand did not fare well through intermediaries because they often clashed with Prudential's 2,000 direct salesforce. Prudential laid off its salesforce in February.

Mr Wood will make a presentation to the City a week on Friday. It will also cover M&G, the fund manager Prudential bought two years ago.

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