Canada Life's sales of with-profits insurance policies have remained above average since business resumed after Christmas despite the company's denial that it is about to abandon its mutual status.

Canada Life has written to brokers informing them that the minimum cost of a policy will now be £50 per month against £25 previously in a bid to stem the tide of speculative purchases.

"The early indications are that this has had some dampening of the levels of speculative investment," a Canada Life spokesman said.

But he added that sales remained "above average" for the time of year.

Sales in the run-up to Christmas were about treble the usual monthly level, running into the thousands as droves of people, particularly from Cork and Galway, sought to buy policies. Many were keen to purchase ahead of December 31st, 1997, which was seen as a possible cut-off date for pay-outs if the company demutualised.

Holders of with-profits policies would qualify for pay-outs if the company demutualised - changed its status from a company owned by its members into a company owned by shareholders.

"People are still buying on the hope that the company is about to demutualise but there is no truth in the rumour," the spokesman said.

He said nothing had changed since before Christmas when Canada Life issued a statement saying it had no plans at present to demutualise. It admitted at the time that Canada Life in Toronto had examined the advantages and disadvantages of such a status change but said no decisions had been made.

The recent announcement by Mutual Life, Canada's fifth-largest life assurance group, that it would seek policyholder approval to become Canada's first insurance firm to demutualise has triggered the speculation that other Canadian mutuals might follow suit.

But the spokesman said demutualisation was not on any timetable or on any board agenda and its sales force had been informed of that.