Insurer Standard Life posted a first half operating profit below analyst forecasts on Wednesday, hit by an increase in provisions for customers cashing in policies, but said it was on track to meet its targets.

Wednesday's results are Standard Life's first as a listed company after it ended eight decades as a mutual insurer in July and floated on the stock exchange in the country's biggest initial public offer in six years. It joined the FTSE 100 last week.

Standard Life said its operating profit before tax came in at 206 million pounds on a European embedded value (EEV) basis. Life and pensions profits totalled 250 million pounds after negative operating assumption changes, including a 100 million pound increase in provisions for policy lapses after its demutualisation and A Day changes to the UK pension system.

We have been net winners from the heightened activity in the UK pensions market. However, we have seen in recent weeks an increase in lapses and have deemed it prudent to set aside a provision until lapse levels return to normal, Chief Executive Sandy Crombie said in a statement.

We remain on track to hit both our UK Life and Pensions cost-cutting target of 30 million pounds and our 2007 (return on embedded value) target of 9 to 10 percent.

A median of analysts' forecasts polled by Reuters had predicted an operating profit of 249 million pounds at the UK's fifth largest life insurer, with all forecasts in a range of 230 million to 263 million pounds.

Standard Life did not give proforma half year comparisons. It posted an EEV operating profit of 395 million pounds in the full year 2005.

Standard Life said new business contribution before tax came in at 91 million pounds, almost three times the figure for the full year last year.

Its embedded value per share an indicator of the value of an insurer's existing portfolio came in at 246 pence including proceeds from the float, just shy of the median of forecasts.