Sovereign says new adviser regulations hit sales in 2011

Despite this Sovereign recently had its A+ rating reaffirmed by AM Best.

While AM Best praised Sovereign's profitable operating performance, Anderson said the increased regulatory burden had hit the bottom line.

"Competitive pressure on premium rates and the difficulty in passing on higher regulation costs have impacted the company's new business profitability," he said.

"Adviser sales capacity has been negatively impacted by an increased demand for regulatory training and consequently the company's share of new business premiums declined in the year to June 2011."