Old Mutual's 3Q sales fall 4 pct, hit by slowdown

LONDON - Third-quarter sales at insurer Old Mutual fell by 4 percent from a year ago as the global economic slowdown eroded demand for life insurance around the world, the company said Thursday.

Life insurance sales fell to 1.25 billion pounds ($1.99 billion) in the three months to Sept. 30, from 1.29 billion pounds a year earlier, Old Mutual PLC said. It did not report profit for the period.

London-based Old Mutual, which has operations in the U.S., Europe and South Africa, said the decline was driven by weak sales in Europe and the U.S., where the economic slowdown has been most profound. In Europe, life insurance sales fell 8 percent in the third quarter to 746 million pounds ($1.19 billion).

South Africa and the Nordic region, however, performed strongly, helping to soften the impact of the losses from other regions. Life insurance sales in South Africa rose 9 percent to 271 million pounds ($431 million).

The value of the company's assets were slashed by the falling global stock markets, where the company invests its insurance premiums. Total funds under management fell 9 percent in the last nine months to 254 billion pounds ($404 billion).

But, despite the difficult current economic environment, Old Mutual's new chief executive, Julian Roberts, who took the post eight weeks ago, was optimistic about the company's long-term outlook.

"While we expect market conditions to remain difficult in the balance of the year, I am confident that the group as a whole remains resilient and our businesses are well positioned to deal with the challenges," he said.

Old Mutual's shares gained 3.2 percent to 55.3 pence ($0.87) on the London Stock Exchange.

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