UK life assurer Standard Life is likely to offer discount shares and loyalty bonuses to millions of members and customers in the run-up to its proposed demutualisation.

The incentives are aimed at retaining large numbers of retail shareholders, who are generally deemed more loyal than institutional investors.

The mutual will tomorrow distribute demutualisation documents to its 2.5 million members, outlining bonus schemes and giving exact details of the windfalls that will be paid to members.

Around 94,000 Irish members of the company are in line for demutualisation windfalls.

Standard Life is expected to offer members and additional customers the chance to buy shares in the company at a discount rate before the flotation. It is also expected to offer members a bonus share for every 20 shares they receive once they have held the stock for 12 months, in a bid to deter private shareholders from offloading their investments soon after the flotation.

Standard Life is moving away from simply accumulating policies to focus on profitable business such as self-invested personal pensions and "wrap" products, which allow investors to bring together a wide range of investments in one place.

Around 2.4 million Standard Life members are in line for average windfalls of about £1,000 (€1,445).

Some could receive significantly higher payouts.

Details will be announced tomorrow but they are likely to include a fixed element of £250-£500 for compensation of loss of membership and a variable amount based on how long investors have held their policies and how much they are worth.

The group is expected to list on the London Stock Exchange in July with a market capitalisation of £5 billion-£6 billion.

Standard Life declined to comment. - (Financial Times Service)