"We would like to reassure our customers that our with profits funds (Sun Alliance & London Assurance Company and Royal & Sun Alliance Life & Pensions) meet all the necessary regulatory solvency requirements.

What is more, in contrast to the Equitable Life position, these funds benefit from being part of the worldwide Royal & SunAlliance Insurance Group and we will ensure that all solvency requirements continue to be met in the future.

Press speculation that the Group is selling off assets to shore up its life funds is wholly incorrect as is the suggestion that the Group is working closely with the FSA on some sort of corporate "recovery programme".

The Group is financially sound and determined to take full advantage of the positive market environment for general insurance - that is the reason for the capital release programme we announced in last November.

We are positioning ourselves to grow our business, maximising on the opportunities we see in general insurance over the next few years.

The media has picked up on references to guaranteed annuity provisions, which were included in our UK Life company's statutory returns to the FSA.

There is nothing new in these provisions.

Over the years, we have set aside substantial reserves, currently �1.2 billion, to cover potential liabilities in this area.

These reserves are based on very prudent assumptions, we continue to be comfortable with them and we have not had any discussions with the FSA or anyone else about a need to increase them.

Speculation over future bonus rates and future investment returns are issues for the whole life insurance industry, given the difficult share markets we have seen over the last couple of years, and continuing into this year.

We believe any changes we have made are appropriate and reflect the nature of the guarantees our products carry.

Changes in maturity payouts are broadly in line with other companies and customers with maturing Royal & SunAlliance with profits policies continue to see investment returns that are comfortably ahead of inflation."