Standard Life's new business jumps 61% to £8.3bn

Standard Life yesterday recorded a 61 per cent surge in worldwide new business to £8.3bn as Europe's biggest mutual life assurer benefited from investors' flight to financially strong companies.

The Edinburgh-based mutual said the figures for the 12 months to 15 November were the strongest results in its 176-year history. The record performance came just before Scott Bell, Standard Life's managing director, steps down next March after 44 years at the company.

Standard Life, which is one of only six life assurers in the world with a triple A financial rating, attributed the surge in new business to the shocks that investors have had this year through the demise of Equitable Life and the effect on the stock market of the US terrorist attacks of 11 September.

Mr Bell said that the number of customers Standard Life had picked up from Equitable Life was "marginal", but he added: "There has been a flight to quality in general as people and brokers realised this year the importance of financial strength."

Mr Bell said the results were also buoyed by Standard Life conveying its pro-mutual message more effectively to new and existing customers. The life assurer came under attack last year when Fred Woollard, the Australian fund manager, tried to force it to convert to a public company.

"We were criticised last year for being unaccountable and that was partly fair. We have become better at making people see the benefits of mutuality," Mr Bell said. He added that Standard Life would remain mutual despite the handover of control of the business from him to his former finance director Iain Lumsden.

The company recorded a strong performance in the UK, where sales rose by 76 per cent to £6.3bn. One of the biggest increases was in pensions. Individual pensions sales rose by 60 per cent to almost £2bn and sales of group pensions rose by 98 per cent to £2bn.

Standard Life Bank, which was set up three years ago, faired less well with mortgages only slightly up from £5.48bn to £5.56bn. The business's projected breakthrough into profit has been delayed from next year to 2003 due to very stiff competition in the mortgage market this year.

Standard Life also reported strong progress in its overseas operations, including entry into the Hong Kong and Indian markets, with plans to gain a business licence in China as early as next year.