A credit rating - issued by rating agencies Standard and Poor's, Fitch and Moody's - would help Phoenix reduce the cost of its senior debt by about 50 basis points, get longer maturities, and access to wider group of investors.

"We will start the engagement with the agencies between now and the turn of the year. We expect, hopefully, to complete the process in the first half of next year," Group Finance Director Jim McConville told Reuters.

Phoenix said companies usually seek credit ratings from at least two agencies.

Heavy debt had forced Phoenix into a financial restructuring and a two-year hiatus from the buyout market until early 2013, when it renegotiated repayment of 2.3 billion pounds in debt.

Phoenix Group, formerly known as Pearl Assurance, sold its asset management business in March, helping it pay down 250 million pounds of debt and focus on its life insurance business.

Post the sale, a bond issue and restructuring of loans last month, Phoenix's senior debt has reduced to 1.2 billion pounds from 1.7 billion pounds at the start of the year.

Group operating profit rose to 266 million pounds in the six months ended June 30, from 186 million pounds a year earlier.

Phoenix said the operating profit included 114 million pounds from "management actions", an increase from 24 million pounds on that basis in the same period last year.

However, shares in the company fell about 1.5 percent in early trading as Phoenix kept its interim dividend unchanged at 26.7 pence per share.

"In our view, the dividend discussion is somewhat of a zero-sum game - management could clearly pay out more, but would then need to raise more from shareholders for future M&A," Berenberg analysts said in a note.

The stock was trading down 0.5 percent at 711.5 pence at 1036 GMT on the London Stock Exchange.

(Reporting by Roshni Menon in Bangalore; Editing by Ted Kerr and Gopakumar Warrier)

By Roshni Menon