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Corporate activity has continued to preoccupy the insurance sector. Life assurer Friends Provident’s planned £8 billion merger with Resolution Life provoked the intervention of major player Hugh Osmond of Pearl Group and drew, from Swiss-based Zurich Financial Services, the admission that it was examining a possible approach.

Other potential bidders are said to have included Standard Life and South Africa’s Old Mutual. French insurer Axa, whose investment arm already has a stake in Friends, is also watching events closely.

Claims of more than £400 million for the floods in June dampened interim results from L&G. Chief executive Tim Breedon said the company did not intend to make a big acquisition, in spite of the Friends/Resolution tie-up, adding that the company had seen a significant increase in the number of companies anxious to offload the risks of running occupational pension schemes onto their insurers.