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Premium income rises 1.9% at United Assurance

Nic Cicutti
Friday 24 January 1997 00:02 GMT
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United Assurance, the insurer created out of the recent merger of United Friendly and Refuge Assurance, two home service companies, yesterday announced an increase of 1.9 per cent in premium income to pounds 66m in 1996.

The slight overall increase masked differences between both companies in the premiums received. Refuge's ordinary branch business grew slightly from pounds 8.2 to pounds 8.4m in 1996. United Friendly's income dropped marginally to pounds 9.6m.

On the industrial branch side, where premiums are collected door-to- door, Refuge's income dipped to pounds 11.9m, while United's dropped by pounds 1.6m to pounds 7.5m.

Nevertheless, the results were welcomed by the merged company's group chief executive George Mack: "Overall, business performance was broadly in line with expectations, maintaining progress in the latter part of the year, following the announcement of the merger.

"Our immediate priority is to continue with the integration of the two organisations as quickly and effectively as possible, while at the same time minimising any disruption to the production of new business."

Despite the relatively static flow of regular premiums, the merged organisation's PEP and unit trust income rose 53 per cent to pounds 38m, underlining a growing trend for savers to opt for one-off investments rather than stick to long- term schemes.

Both companies merged to become a new pounds 1.5bn insurer late last year, in a move expected to cost up to 1,800 jobs, a quarter of staff in both organisations, this year.

The merger reflected long-running contractions being suffered by the UK insurance industry, hit by rising costs and over-supply in an increasingly competitive market.

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