Skip to main content [Access key C]Jump to the top navigation [Access key T]Jump to the local navigation [Access key L]Jump to the search [Access key S]Jump to the sitemap [Access key M]Jump to the homepage [Access key H]
Standard Life plc - Annual Report and Accounts 2007
Home The Group
at a Glance		 Business
Review		 Corporate
Responsibility		 Governance
Information		 Financial
Statements

UK financial services - Healthcare

Standard Life Healthcare offers a range of private medical insurance (PMI) and healthcare solutions - making it the 4th largest PMI provider in the UK.

Key performance indicators 2007 2006 Movement
New business sales £22m £20m 10%
IFRS underlying profit before tax* £13m £12m 8%
Return on equity after tax* 8% 12% (4% points)
Claims ratio 70.8% 68.3% (2.5% points)

* 2006 is shown on a pro forma basis.

Please refer to the basis of preparation section in the business review and the glossary.

New business

New business sales: £20m in 05, £20m in 06, £22m in 07In a competitive market, overall new business increased by 10% to £22m (2006: £20m) whilst maintaining our strategy of writing only profitable business. The increase reflected improved performance by our direct marketing channel which resulted in a 21% increase in individual new business. Full year group sales grew by 2% compared to 2006 as we continued to focus on profitable segments of the Small and Medium Enterprise (SME) segment of the market.

Performance

IFRS underlying profit before tax was £13m (2006: £12m), before taking into account one off costs relating to integration of the PMI business acquired from FirstAssist in 2006, and project costs associated with the new system development. The 2006 underlying profit included a £4m surplus on the prior year claims reserves. Excluding this surplus, the 2007 underlying profit increased by £5m. This was principally due to an improved performance and full year contribution from the acquired business together with an increase in investment income as a result of higher interest rates. Claims experience was in line with expectations. Return on equity (RoE) for 2007 was 8% (2006: 12%). The 2006 RoE was benefited by the absorption of FirstAssist, however we are on track to achieve our target RoE of 15% in 2008.