Standard Life, Britain's largest mutual insurer, admitted it had lost its place as the most popular life assurer among independent financial advisers (IFAs) yesterday, after its IFA market share fell from 15.5 to 13.5 per cent in 12 months.
Sandy Crombie, the chief executive, said he was happy his company was still one of the top two, and insisted that Standard could regain the top spot, which it has lost to Norwich Union.
The news came as the company published its interim results for the six months to 15 May, revealing a sharp decay in its UK business over the last year, following on from worries over the group's solvency which arose at the start of the year. The company is moving towards a planned demutualisation and stock market float in 2006.
UK life and pensions annual premium equivalent (APE) was down 13 per cent compared with the first half of 2003, which itself was a poor six months for the life insurance industry. Protection sales were down more than 60 per cent due to the company's decision to "hold back from the market" as it carries out a restructuring of the business.
Mr Crombie said the fall in life and pensions business was also partly due to decisions to raise prices in certain sectors of its business. He said he did not believe the falls in new business would be repeated in the second half. "Some of that market share we have given up willingly," he said. "We are interested in running a business profitably and there was a view that some of the market was acting unprofitably.
"Our view is that we've had a very difficult set of circumstances in the past year and against that I think this is a very good result."
In spite of the problems in its home market, the group's overall APE for the half was the same as the first six months of last year. In its Canadian operations, APE was up 6 per cent, while in the rest of the world, it was up 27 per cent.
Mr Crombie said that the group was committed to keeping the Canadian operation, but it was keeping all options open, including a sale, for its small Spanish business. He said it did not fit very well with the rest of Standard's operations.
He added that the group was talking to major high street financial companies about the potential for forming partnerships once the polarisation of the financial advice market is abolished later this year.
He added that Standard would aim to win back customers in the second half of the year with a series of product enhancements and new launches. He said the company was committed to the with-profits concept but believed it would play a much smaller part in the life industry going forward.