Mutual life insurer Standard Life is expected to deliver another blow to investors today by cutting its bonus rates on with-profits policies.

The Edinburgh-based insurance giant is thought to be set to cut overall payouts by up to 30 per cent, while final bonuses on with-profits endowment policies could be slashed by as much as 50 per cent.

The expected cuts will come at a torrid time for investors - a number of life insurers have slashed their payouts after being battered by three years of tumbling stock markets.

Earlier this month Britannic cancelled annual bonuses for one million policyholders while Norwich Union cut bonuses and payouts for 3.3 million.

The plight of the insurance sector has hit the battered stock market further.

Analysts say the recent sharp falls in the values of shares came partly because life insurers offloaded equities in order to opt for less risky bond and property investments.