The health insurance and protection market covered
Bright Grey and Scot Prov new business slump continues
Bright Grey and Scottish Provident have reported steep falls in new protection business over the first half of the year.
The Royal London owned pair reported a combined drop in sales of 17% to £141m (on a Present Value of New Business basis) compared to £170m in the first six months of last year.
These figures continued last year's slide which eventually saw new business drop more than 10% despite a fourth quarter recovery.
The providers have seen a significant back-office realignment over the first half of the year which has resulted in, among other things, shared sales teams.
However, the Group has maintained that the brands will remain separate entities.
A statement from Royal London explained the struggling mortgage market was still the main reason for poor performance.
"The protection market continues to be very difficult for new business, not least because of the well-documented problems of the mortgage market," it said.
"The Group's protection brands have been working very hard in the first half of the year, making a number of strategic changes to help ensure a clear differentiation between Bright Grey and Scottish Provident.
"This has been an exciting and challenging process, involving significant investments to ensure we have the strongest possible propositions for advisers. The changes not only reinforce our commitment to a multi-brand strategy, they also provide an excellent platform for future success," it added.
Overall, total new business was up 11% to £1,788m compared to £1,615m at the same point last year.
Earlier this month the Group also confirmed further details of its takeover of Royal Liver.
Mike Yardley, outgoing group chief executive, was pleased with the results and noted the strong performance should see the business through an uncertain time.
"The Group has once again delivered a good set of financial results and is clearly financially robust," he said.
"We have increased the operating profit, which we believe is the best measure of performance, as well as improving the contribution from new life and pensions business.
"Markets may well continue to be volatile, but our strong capital position will help ensure that Royal London continues to deliver good performance," he added.
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Blinkered
We stopped volume sales of Bright Grey and Scottish Provident when they messed up our exising relationships by moving well trusted support BDMs about and giving us newbies. We are a people business and it takes a while to build a trusted relationship. The management thinks that it can come in and sweep people away - it can but it is like simply closing the shop and sacking the staff. People buy from people, does not matter what the management is like but there is no incetive to loyalty once the BDM moves on. With that move you lose the goodwill and relationship. Perhaps the management of these large providers will never understand that and then still wonder why they lose market share. Bad move for these big boys who manage from ivory towers. Haha! BTW there is a cracking couple of newcomers out there who are doing very good things building through BDMs so that is where our business goes.
Posted by: dwinsal | Aug 16 2011
What a way to run a business.
I echo the comments concerning abysmal service - from both firms. Also I have had issues with their claims handling - a long way from consumer friendly. Yet another example of why life companies are held in such low regard.
Posted by: Harry Katz | Aug 16 2011
Scot Prov
The Scottish Provident system, admin, and service are a disgrace..it might be a good product, but without above...waste of time.
Posted by: Protection Adviser | Aug 16 2011
Differentiation
The 4 year business has only just started so it isn't that - perhaps it's just the service issues?
Posted by: Daniel Lee | Aug 15 2011
Clear differentiation
I love the fact that clear differentiation includes launching the same CI product under both brands and copying the bright grey Relevant life product and launching under the Scot Prov brand, feels like a clear policy on differentiation, or is that just no 2 year claw back on Scot Prov!
Posted by: Andrew | Aug 15 2011
Tripe
Perhaps the lousy admin and new 4 year commission terms might have effected business
Posted by: John Cooper | Aug 15 2011
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