Friends Provident International (FPI), the Isle of Man-based life insurer which is one of several life businesses owned by Resolution, recorded a 24% rise in sales to £238m.
Lombard, the Luxembourg-domiciled ultra high net worth provider, saw a 10% increase over the year to reach a total of £302m. International sales also include those of AmLife, the Malaysian life insurer in which Friends Provident has a 30% stake.
Rocco Sepe, FPI managing director, said most international markets in which Friends Provident operated had performed well, reflecting a general a return of consumer confidence, particularly in the second half of 2010, which led to record overall sales.
Sepe added that international sales in 2010 accounted for 53% of Friends Provident Group’s total new business, building on 2009 when international revenue edged above that of the UK domestic market for the first time.
International business also accounted for more than half of total profits, which for the group were £848m in 2010, noted Sepe, of which £427m was generated overseas.
Resolution, the Guernsey holding company which owns Friends Provident and its associated companies, last year acquired Axa’s UK life business and Bupa Healthcare. Sepe said it would be difficult for overseas sales to maintain their lead on the UK in fullness of time as Axa and Bupa sales would be likely to boost the UK total.
He said a reasonable target for overseas sales would be to maintain a 40% share of the group total in future.
“We’re going to give it our best shot [to maintain more than 50%] – it’s not a bad aspiration. The UK’s clearly had the benefit of Axa’s business for six months of last year and it will make quite a difference going forward, but if we can keep north of 40% we will be very happy.”
Overall, group profits after tax were down on 2009’s figure of £1.3bn, while UK sales, excluding Axa UK life business, of £391m were down by 4% in 2010 compared to the previous year.
The business results come as FPI has received a higher financial strength rating by AKG Actuaries & Consultants.
AKG’s Offshore Profile and Financial Strength Reports are designed to meet the needs of advisers and analysts in assessing the relative strengths of Offshore long term insurers.
FPI was awarded a B+ (very strong) upgraded from a B (strong).
Irvine Baxter, FPI UK sales director, said: “This sends a positive message to our business partners worldwide.”
FPI owner Resolution, led by insurance entrepreneur Clive Cowdery, has embarked on what it calls a “UK Life Project” to consolidate the UK life insurance market. This began in 2009 with the acquisition of then London-listed Friends Provident Group and was followed last year by the Axa and Bupa deals.
Once this process is completed – it remains to be seen which other insurers Resolution will acquire – it is planned the combined businesses will be refloated on the UK stock market. Ratings such as financial strength will therefore be important in helping determine a fair value for the business ahead of any IPO, which is planned for 2013.
