Finance worries hit Standard Life

Worries over Standard's financial strength hit sales

Worries over the financial strength of insurer Standard Life have hit the firm's market share.

The firm reported flat first-half sales, and its share of the UK market fell to 10.2% in the first quarter of this year from 11.1% previously.

The negative publicity earlier this year surrounding its talks with the UK regulator over its financial strength hit sales, the firm said.

Standard is aiming to scrap its mutual status and seek a stock market listing.

Unwelcome 'noise'

Earlier this year, Standard Life was in talks with Britain's regulator over its finances ahead of the introduction of new rules on how to account for guarantees made to policyholders.

"The consumer has been affected by the noise affecting the life and pensions business but doesn't appear to have lost faith in the Standard Life brand," said chief executive Sandy Crombie.

Sales of life and personal pensions were down 13% to £430.7m for the six months to 15 May.

Overall, new business sales were £691m.

Mr Crombie said: "Outside our UK life and pensions business we are seeing strong growth."

Corporate pension sales rose 14%, while general insurance sales increased 5%.

The company, which is gearing up to sell its shares on the stock market in 2006, plans to hold onto to its international businesses.

However, the future of its Spanish unit is currently under review.