Members of Standard Life who received free shares when the formerly mutual insurer floated on the stock exchange, and who held them for a year, should by now have received their bonus shares. If you were thinking of cashing in your chips, and had been waiting only for the bonus, the time has come to review your intentions.

Back in July last year, when the company made its debut on the stock exchange, qualifying members of Standard Life's with-profits fund were allocated a basic 185 free shares, worth £425.50 at the time, plus an additional allocation dependent on the value of their policy and the length of time the policy had been held for.

Additionally, 492m shares, worth about £1.13bn at the issue price, were allocated to retail investors. Those who received free shares were able buy more at a special discounted rate.

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In order to encourage people to hold their shares, rather than sell them straight away, the company offered anyone who received free shares or bought more at the time of issue, and who remained investors at close of business on July 10 2007, one bonus share for every 20 held. These shares have now been handed over, so anyone who had been hanging on for them before they sold is now free to go. But should you?

Time to sell?

Those who took up shares at the flotation have undoubtedly done well, seeing their holding deliver returns of more than 50% over the year, including bonus shares and dividends. This compares with an increase of about 15% on the FTSE 100 index of Britain's biggest companies.

Check the Standard Life share price now

On the share price alone they have seen massive growth. Despite a dip following the bonus issue a couple of weeks ago, when the stock market was generally down anyway, the post-bonus price now stands at 324p 07/08/07, compared with the launch price of 230p. This is a rise of well over 35% since flotation, and a rise of 8% this year, comfortably overshadowing the nine-member FTSE All-Share Life Insurance Index, which is down 9.1% over the same period.

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Moreover, the company has just posted better-than-expected half-year results, with a 31% increase in first half sales, helped by strong growth in its UK life and pensions business. The company has been buoyed by the boom in Self-Invested Person Pensions Sipps since pension reforms 18 months ago, and new business rose to £8.18bn, from £6.24bn compared to a year earlier, beating analysts' mean estimates of a rise of £7.87bn.

Let's be Friends...

It also appears that the insurer is confident enough to muscle in on the proposed merger of the closed life funds consolidator Resolution Life and fellow former mutual Friends Provident. Standard Life has refused to confirm that it is a player in this arena, but the fact that the rumour is credible is credit to Standard Life's reinvention of itself since the gloomy period prior to flotation, when the City regulator, the Financial Services Authority, forced the insurer to offload £7.5bn worth of equities at the bottom of the market to bolster its capital position.