Sir Peter Davis, chief executive of Britain's biggest life assurance group, described the sales figures as "very encouraging". He added that the sales momentum "we built up in 1996 has continued into 1997".
The figures were received reasonably favourably among analysts. Charles Landa, analyst at SocGen, said they were "obviously very good figures". However, along with other analysts, he said the Pru's UK results - its largest business area - were less impressive than other parts of the world.
Most of the improvement came from the US, where Jackson National Life has reaped the benefit of expanding its product range. However, Andrew Pitt, an analyst at Salomon Brothers, said, "Don't get overwhelmed by the Jackson National Life figures in the US," noting that new products introduced throughout 1996 boosted the first-quarter figures.
After the release of the figures Prudential's shares featured among the FTSE 100 index's best performing stocks, recording a 1.2 per cent advance at one stage, but drifted in later trading and closed the session just 1p higher at 568.5p.
Sales of fixed annuities in the US rose 43 per cent to pounds 324m, equity- linked indexed annuities grew from nothing to pounds 55m and variable annuities from pounds 19m to pounds 111m. Sales of guaranteed investment contracts grew by 30 per cent to pounds 215m and insurance contracts by 71 per cent to pounds 705m.
In the UK performance was much more patchy. Regular premium business was up 18 per cent at pounds 84m but single premium business grew only 2 per cent to pounds 885m, in spite of improved sales of the Prudence Bond, Britain's best-selling product, which brought in pounds 221m of single premiums.
Pension sales were up 6 per cent to pounds 104m, life policies by 6 per cent to pounds 344m and sales of investment products including PEPs doubled to pounds 72m. But sales of annuities were down 15 per cent to pounds 180m and business linked to DSS contributions was also down, to pounds 185m.
The direct sales force accounted for over half the UK sales of single premium policies, pounds 468m out of pounds 885m, and its sales of investment products trebled to pounds 65m, almost compensating for an 11 per cent fall in sales of insurance policies.
Sales through independent financial advisers (IFAs) increased by 8 per cent to pounds 417m, but the growth came entirely from insurance policies, with investment products tailing off to just pounds 37m.
The direct sales force was mainly responsible for the modest growth in the more valuable regular premium business, increasing sales by 18 per cent to pounds 71m.
The use of IFAs to sell products increased in the quarter. They account for 47.1 per cent of single premiums sales, up from 44.8 per cent, and for 15.5 per cent of annual premium sales.Reuse content