Wesleyan Assurance Society has reported a drop in new business owing to a reduced lifetime allowance and falling Isa sales.
New business sales on an annual premium equivalent basis fell to £41.6m gross for 2013, down from £47.9m in 2012. Total gross premium income also fell to £297m, down from £387m the year before.
However, assets under management grew 7.7 per cent to £5.6bn in 2013 and the company reported a 15.7 per cent annual return on its main with profits fund.
In terms of new business, Craig Errington, chief executive of Wesleyan, said an 18 per cent increase in new general insurance commission income was offset by a fall in pension product sales.
This, he said, was due to the drop in the lifetime allowance which especially affected the society’s medical professional customers using the NHS pension scheme.
Mr Errington added: “In line with others in the industry, we also saw a fall in the Isa transfer market following the change in regulations.
“In 2014 we expect a greater proportion of our income to come from protection business given the reduced opportunities in the Isa transfer and pensions market. We also welcome the increased opportunities and flexibility for customers saving into Isas announced in last week’s budget.”
In relation to the strong with-profits performance, he said that although with profits funds have received negative coverage previously, “not all funds perform the same”.
“Our strategy is to retain above average exposure to equities in the fund, which has a 64 per cent equity allocation compared to the average of 40.4 per cent. We are able to do this because we are a financially strong company.”
