A mooted £3.5 billion takeover of Friends Provident is under threat unless it agrees to bid talks by Friday, US buyout firm JC Flowers has warned.

Friends Provident has rejected a 150 pence cash offer proposal from private equity group JC Flowers valuing the life assurer at £3.5 billion.

Shares in Benfield fell 15% after the UK reinsurance broker reported a 7.4% pct decline in 2007 profits.

Shares in Standard Life jumped 11% after full-year earnings beat market forecasts.

UK life insurer Friends Provident reported a sharp fall in profit for 2007 as it said it is making good progress on its new strategy.

Insurance giant Aviva has only managed to squeeze in a 1% rise annual operating profit after earnings were squeezed by a high number of policy claims.

High insurance claims from flooding have failed to dampen Royal & Sun Alliance after it still manage to grow annual profits.

Insurance group Aviva said claims from last summer's floods will be £75 million higher than expected.

Life and pensions group Friends Provident is to cut around 600 jobs by 2009 in a £60 million cost-saving exercise.

Life and pensions giant Standard Life today reported a 20% drop in fourth quarter UK sales following the market volatility.