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New research by investment management company Managing Partners Limited shows only 13 per cent of IFAs have a positive view of with profits-based investments, while more than three in five IFAs have a negative view.

Ned Cazalet, of Cazalet Consulting, said: "It's nothing new. Many providers of with profits closed some years ago and with profits have been at very low levels for a number of years now.

"If you go back to 2000/2001, with profits were very buoyant at the time of the tech boom, but many companies which provided it at that time are either closed altogether or have closed their with profits business.

"Some of the market leaders, such as Liverpool Victoria, cut their with profits products substantially and there are not many around now, whereas six or seven years ago there was a big bunch of them."

He added: "With profits endowments were also a big let-down. They were sold 25 years ago and have been a big disappointment for some.”

Jeremy Leach, managing director of Managing Partners Limited, said: "With profits investments have been delivering very poor returns for some years now and the turbulence seen on financial markets over the last year will undermine those returns further.

"With profits were once a major consideration in the advice offered by IFAs but now it is rapidly becoming a dead-duck."

Mr Cazalet agrees that equity exposure is no longer appealing to investors, adding: "People do not want as much exposure to equity as they did as sentiment is not helped by the impact of poor markets.

"The funds which have a very low exposure to equity are the ones people will go for."

Nearly 60 per cent of IFAs are pro-actively trying to find an alternative investment product that has many of the characteristics of with profits investments, according to Managing Partners Limited’s research.

Traded life policies are seen to provide steady, predictable returns and the traded life policy market has seen huge growth from US$50m (£27m) in 1990 to $20bn in 2007.

But Cazalet added: "As far as alternatives go, variable funds are the big talking point. People want a managed portfolio as it gives insurance as well as some of the risks.

“I think we'll see people moving into risk assets with some sort of protection around them, so it's not letting people down."