Dutch insurer Aegon has reported a 7% drop in net income for the first quarter as losses from investments during the period impacted the results.

The company lost E26 million on investments during the quarter, compared to a E297 gain last year. However, operating earnings before tax rose to E827 million, a 92% increase from the same period last year. The company said that the rise reflected the effect of favorable financial markets on the valuation of certain assets and liabilities.

New life sales in the UK soared to 51%, driving total life sales to an increase of 12%. The value of new business amounted to E163 million, an 18% rise from 2005. In north America, a 16% increase in variable annuity sales was a result of strong sales across all distribution channels, the insurer said.

Aegon’s results for the first quarter of 2006 included a notable increase in the value of new business, providing further indication that our focus on growing our core lines of business profitably in our major and developing markets makes sense, said Aegon chairman Donald Shepard.