The Great Fire of London in 1666 sparked the creation of the first insurance company in 1680, a sector now contributing around £20bn in taxes annually. Over time, insurers have exited various markets, leaving them with costly liabilities of managing closed books of policies. However, one insurer's unwanted business is another's gold mine, as consolidators like Chesnara and Standard Life (formerly Phoenix Life) step in to administer these policies efficiently and profitably.

Chesnara, a FTSE 250 specialist, reported strong interim results for June, boosted by its acquisition of HSBC Life's UK arm. Operating capital generation rose 79 per cent to £96mn. The company also completed the purchase of Scottish Widows Europe from Lloyds, adding 46,000 policies. Analysts at Berenberg note Chesnara's strong cash position enables further deals.

Chesnara shares offer a forward dividend yield of 7 per cent, and RBC Capital Markets highlights a free cash flow yield exceeding 13 per cent, ranking top among peers. Its book valuation at 1.2 times price to unrestricted tier-one equity is attractive versus the peer average of 1.5 times.

Meanwhile, Hays saw operating profit growth despite an 8 per cent drop in net fees to £906mn, hit by a £90mn exceptional charge leading to a £55mn statutory loss. The dividend was cut by 65 per cent, but management believes cost cuts, focused on back-office roles, will preserve consultant capacity for an eventual market recovery.