A new report by rating agency A. M. Best has found that trading condition for life insurance companies in the UK have now levelled off, although the long-term outlook is still difficult. The report revealed that the UK life insurance industry has focused on improving capital efficiency, quality of earnings and generating cash, which is helping it achieve stable growth after the upheaval of the economic crisis . Full-year results for 2009 and figures for the first half of this year exhibit a significant improvement in International Financial Reporting Standards (IFRS) profits for most UK life companies . This upswing, however, is partly being driven by improved investment returns, because the percentage of profitable risk-type products such as term assurance and annuities dropped more sharply than safer investment vehicles. For instance, bulk-purchase annuity volumes fell by more than a half last year. New business volumes relative to 2008 also experienced a dramatic drop, with insurance groups that have a significant international operations feeling the most pain. The capital position for the majority of life insurance companies in the UK has been getting better for the last year and a half, when it reached its nadir. Many companies have been targeting cost-saving strategies, and ideas such as product re-pricing and selectivity, for improving their businesses.
No comments:
Post a Comment