© Reuters. FILE PHOTO: The offices of Standard Life Aberdeen in Saint Andrew Square Edinburgh, Scotland, Britain February 15, 2019.REUTERS/Russell Cheyne/File Photo
LONDON (Reuters) -Phoenix is on track to hit the upper end of its 1.5-1.6 billion pound ($2.07-2.21 billion) cash generation target range for 2021 after capital more than doubled in the first half of the year, the British life insurer said on Wednesday.
Specialist life insurers such as Phoenix buy up books of life insurance business closed to new customers and use economies of scale to manage them more efficiently.
In addition, Phoenix provides bulk annuities – insuring company defined benefit pension schemes – which it said would be the “near-term driver” of its growth in open business.
Phoenix said in a statement that its purchase of the Standard Life (LON:) brand from abrdn, formerly Standard Life Aberdeen, earlier this year would also support growth plans for new policies.
The insurer posted a sharp 46% rise in first-half operating profit to 527 million pounds, though the figure came in below forecasts of 539 million pounds, according to a company-compiled consensus poll.
Cash generation rose to 872 million pounds from 433 million pounds a year ago, beating forecasts of 772 million.
Insurers have recovered ground across the board this year, after being hit by reduced business and market volatility in 2020 due to COVID-19.
“Phoenix has made further strong progress against our stated priorities of cash, resilience and growth,” CEO Andy Briggs said in a statement, adding that the insurer was looking to build on its position as the UK’s largest long-term savings and retirement business.
Phoenix said it would pay an interim dividend of 24.1 pence per share, in line with forecasts and 3% higher than a year ago.
($1 = 0.7230 pounds)
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