Partnership has reported its new business premiums of long-term care annuities had ‘fallen behind expectations' as sales dropped by 38% compared to the same period last year.
The insurers' H1 2013 results showed new business premiums for Care were £28.1m, down 38% on H1 2012 where new business premiums had reached £45.5m.
The insurer attributed this to the RDR and "uncertainty" among consumers as to the impact of the potential cap on care funding as part of the Care Bill proposals.
However, in a statement the Directors said they remained of the view that the immediate needs care annuities sold by the Group continue to be a "valuable solution" for those entering long term care, and that the impact of the proposals set out in the Care Bill will not depress demand for such products over the longer term.
Steve Groves, chief executive of Partnership said: "The sale of annuities for funding long term care has fallen behind expectations in the first half of 2013. The impact of the outcome of RDR on advisors selling Immediate Needs Annuities has been more significant given the increased complexity of the advisory process, and this has led to a reduction in the level of activity in the first half of 2013.
"As market commentators and financial advisors digest the implications of the government's proposed cap on the cost of care set out in the Social Care Bill, the clarity surrounding the level of state provision and the benefits of passing the longevity risk to insurers should also increase activity in this market."
Groves added that advisers were appearing to return to the market with quote activity in recent months although the conversion from quote to policy for care annuities can be "lengthy and predictable."
Overall the group reported total New Business Premiums of £631m for the 6 months ended 30 June 2013, an increase of 12% on the same period last year, mostly fuelled by the firm's retirement business.
However, the firm also suffered losses as a result of its decision to float on the Stock Market in June. IFRS profit before tax for the six months to 30 June 2013 amounted to £8.6m compared to £17.4m for HY 2012.
It said this fall is primarily due to non-recurring expenditure of £28.5m in respect of the Company's IPO and listing on the London Stock Exchange and £10.5m of additional interest charge in the period resulting from the financing taken out in the second half of 2012 as set out below, the insurer said.
Overall, total operating profit, which does not include costs related to the IPO, increased 31% year-on-year, from £45m to £59m.
