Cirencester reports strong 2012 despite RDR Holloway confusion

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Cirencester friendly's annual results show increases in membership and premium income with reduced operating costs, despite confusion around RDR and Holloway products.

The mutual's results for 2012 showed annual premium income was up from £12.87m in 2011 to £13.79m with overall operating expenses reduced by 5.2%.

The society's annual report and accounts also showed total bonuses allocated to members had risen to £2.1m from £1.6m in 2011.

Paul Hudson, chief executive of Cirencester friendly, said: "Despite considerable confusion surrounding RDR and our unique COB style of income protection insurance that allows customers to build up a modest capital sum, advisers can still recommend these Holloway style products to their clients and receive introductory and trail commission.

"It has been another challenging year for many in the financial services industry, for a number of well publicised reasons, which is why I am pleased to report strong annual figures. Many challenges lie ahead but we will continue to work hard."

He added the outlook was broadly positive with its IP products being treated alongside ICOB IP contracts and the potential opportunity for growth in April's welfare reforms.

A J Knight, chairman of the board at Cirencester friendly, said in the executive summary that Solvency II continued to be on the Society's agenda.

He said: "I am pleased to be able to say that the Society has a level of solvency significantly in excess of the minimum capital resource requirements prescribed by the FSA's Integrated Prudential Sourcebook."

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