AKG says that while there is no evidence of imminent problems, with a major FCA review of the with profits sector under way advisers have a duty to keep a close eye on with profits to protect themselves and clients.

The financial analytics company says that despite a common view that with profits business has dwindled to next to nothing, in fact with profits business "remains considerable."

With profits 'technical provisions' totalled over £274 billion at the end of 2016 suggesting the amount invested in with profits funds remains substantial. Many clients will also still be paying in to with profits funds.

A spokesman for AKG, which has just published a major review of the with profits sector, said: "Given the amount of in-force business is still considerable, advisers should continue to keep abreast of developments in the with profits sector, including FCA review work."

"Advice for in-force clients should be just as robust as it is for new business. Indeed, evaluating existing with profits funds is an important part of an adviser's job."

An FCA review of the with profits sector is under way. In June 2017, the FCA announced that it had issued an information request to the majority of with profits firms to help them carry out a multi-firm review of the sector.

The FCA said: "One of our priorities is firms' treatment of existing customers. This review into the fair treatment of with profits customers, included in our 2017/2018 Business Plan, is a key part of this programme of work."

"The last full review that focused on with-profits business was in 2010. The forthcoming review into the fair treatment of with-profits customers will allow us to understand further the range of practices that are now being adopted by firms."

AKG says that advisers must monitor clients' with profits products, even if they have been in place for many years, and follow the progress of the FCA review to ensure they remain up to speed and can show they have been keeping a close eye on clients' with profits investments.

AKG says that in 2016 the Top 5 companies for with profits business were: Prudential Assurance Company Ltd; Aviva Life & Pensions UK Ltd; Royal London Mutual Insurance Society Ltd; Standard Life Assurance Ltd; Scottish Widows Ltd. Measured by premiums earned, the top 10 companies accounted for 97% of the market in 2016.

The Top 10 With Profits Premiums Earned Companies were: Prudential Assurance Company Ltd; Standard Life Assurance Ltd; Liverpool Victoria Friendly Society Ltd; Royal London Mutual Insurance Society Ltd; Aviva Life & Pensions UK Ltd; Wesleyan Assurance Society; Scottish Widows Ltd; NFU Mutual Insurance Society Ltd; Friends Life Ltd; Phoenix Life Ltd.

Only nine firms showed positive net flows in their 2016 with profits business and the top 3 were: Prudential Assurance Company Ltd; Liverpool Victoria Friendly Society Ltd; Wesleyan Assurance Society.

According to AKG, M&A activity continues to impact on the UK life office with profits market with a string of mergers and takeovers and more on the way.

• AKG's 2017 UK Life Office With Profits Report is available from AKG of Dorking, Surrey.