Life insurance shrinks

07 July 2004
The British life insurance industry has shrunk to almost half the size of the pensions industry, according to a new survey.

The survey, by information firm Datamonitor, shows that the life market dropped sharply to £31 billion pounds last year from £41 billion in 2000.

Meanwhile, Britain's pension market is forecast to increase 40 per cent to nearly £75 billion in the next four years, as people move to supplement their state pensions and tax advantages increase.

Poor stock market returns, weakened consumer confidence and high-profile scandals have hit the British life insurance market, but there are signs of a recovery, Datamonitor said.

The survey forecast the British life market would expand 44 per cent by 2008 to £46 billion pounds.