Life offices are now, in the main, large and well-established institutions, with assets which, at market values, would show a substantial margin over balance sheet values. This margin is known as the ‘inner reserve’ or ‘hidden reserve’ because details of it are rarely disclosed, in fact its very existence is seldom brought before the public gaze; this secrecy is specifically allowed by the Companies Act 1948.

The backing given by these large inner reserves and the advantages deriving from the continuity of the office are two of the most important factors in formulating life office policy, and in the choice of actuarial bases of calculation; and yet these factors are almost always taken for granted, a tribute perhaps to the length and strength of the offices' past history.