The company closed the unit to new business almost two years ago to focus on its general insurance business.

Life insurers have taken a battering in recent years after a slump in share prices affected their ability to underwrite new and existing policies.

They also have been hit by tighter industry regulation and a surge in the number of claims in the US.

Tough measures

Royal & Sun has had to cut about 20,000 staff and sell new shares to boost profits and shore up its balance sheet.

The company is one of a number that have pulled the plug on their UK life operations.

Shares of Royal & Sun jumped by almost 3.5% in early trading in London.

An investment company led by Clive Cowdery, General Electric's former head of insurance, has offered to buy Royal & Sun's unit in a deal worth �900m, according to UK press reports.

But in a statement, Royal & Sun said the sale discussions were "at an early stage and the amounts referred to in the press are purely speculative".