1. Present value of life new business premiums
The present value of new business premiums (PVNBP) is derived from the single and regular premiums of the products sold during the financial period and is expressed at the point of sale. The PVNBP calculation is equal to total single premium sales received in the year plus the discounted value of regular premiums expected to be received over the term of the new contracts. The projection assumptions used to calculate PVNBP for each product are the same as those used to calculate new business contribution. The discounted value of regular premiums is also expressed as annualised regular premiums multiplied by a Weighted Average Capitalisation Factor (WACF). The WACF will vary over time depending on the mix of new products sold, the average outstanding term of the new contracts and the projection assumptions. The table below sets out the factors required to derive PVNBP by business units.
| 12 months 2007 |
12 months 2006 |
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|---|---|---|---|---|---|---|---|---|---|
| Regular premiums £m |
WACF |
Present value of regular premiums £m |
Single premiums £m |
PVNBP £m |
PVNBP £m |
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|
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| United Kingdom | |||||||||
| Individual pensions | 389 | 4.1 | 1,588 | 1,717 | 3,305 | 3,682 | |||
| Group pensions | 83 | 5.5 | 456 | 615 | 1,071 | 1,025 | |||
| Annuities | - | - | - | 1,965 | 1,965 | 1,511 | |||
| Bonds | - | - | - | 4,192 | 4,192 | 3,588 | |||
| Protection | 131 | 5.1 | 666 | 213 | 879 | 1,024 | |||
| Equity release | - | - | - | 243 | 243 | 316 | |||
| UNITED KINGDOM | 603 | 4.5 | 2,710 | 8,945 | 11,655 | 11,146 | |||
| France | |||||||||
| Euro funds1 | 17 | 5.9 | 101 | 1,930 | 2,031 | 1,854 | |||
| Unit-linked funds | 53 | 5.2 | 278 | 1,225 | 1,503 | 1,556 | |||
| Protection business | 20 | 6.3 | 125 | 3 | 128 | 142 | |||
| Total life and pensions | 90 | 5.6 | 504 | 3,158 | 3,662 | 3,552 | |||
| Ireland | |||||||||
| Life and savings | 40 | 4.8 | 190 | 627 | 817 | 626 | |||
| Pensions | 99 | 3.8 | 375 | 538 | 913 | 647 | |||
| Total life and pensions | 139 | 4.1 | 565 | 1,165 | 1,730 | 1,273 | |||
| Italy Total life and pensions |
107 | 5.2 | 557 | 2,367 | 2,924 | 2,768 | |||
| Netherlands (including Belgium and Germany) | |||||||||
| Life | 68 | 6.3 | 428 | 434 | 862 | 895 | |||
| Pensions | 92 | 8.3 | 761 | 1,321 | 2,082 | 1,451 | |||
| Total life and pensions | 160 | 7.4 | 1,189 | 1,755 | 2,944 | 2,346 | |||
| Poland | |||||||||
| Life and savings | 28 | 5.1 | 144 | 264 | 408 | 307 | |||
| Pensions | 35 | 8.2 | 287 | 149 | 436 | 227 | |||
| Total life and pensions | 63 | 6.8 | 431 | 413 | 844 | 534 | |||
| Spain | |||||||||
| Life and savings | 80 | 5.5 | 436 | 1,192 | 1,628 | 1,466 | |||
| Pensions | 34 | 5.7 | 195 | 569 | 764 | 593 | |||
| Total life and pensions | 114 | 5.5 | 631 | 1,761 | 2,392 | 2,059 | |||
| Other Europe2 | 73 | 3.8 | 283 | 135 | 418 | 308 | |||
| EUROPE | 746 | 5.6 | 4,160 | 10,754 | 14,914 | 12,840 | |||
| North America | |||||||||
| Life | 70 | 7.6 | 531 | 42 | 573 | 140 | |||
| Annuities | 1 | 4.0 | 4 | 2,596 | 2,600 | 744 | |||
| Funding agreements | - | - | - | 429 | 429 | - | |||
| NORTH AMERICA | 71 | 7.5 | 535 | 3,067 | 3,602 | 884 | |||
| Asia | 114 | 4.7 | 532 | 458 | 990 | 685 | |||
| Australia | 54 | 3.3 | 176 | 263 | 439 | 297 | |||
| ASIA PACIFIC | 168 | 4.2 | 708 | 721 | 1,429 | 982 | |||
| Total life and pensions | 1,588 | 5.1 | 8,113 | 23,487 | 31,600 | 25,852 | |||