LV=, one of the UK’s largest insurance companies, has released its financial results for the year ended December 31, 2021 (FY21) – and it was a mixed bag with profits falling but other business metrics up.
LV= stated that it had outperformed its new business volumes and profitability targets with significant growth in sales and trading profit, thanks to its strategy to transform the business.
For the full-year FY21, LV=’s present value of new business premiums (PVNBP) totalled £1.6 billion, up from £1.3 billion in the year ended December 31, 2020 (FY20). During the same period, its IFRS trading profit totalled £29 million (a dramatic jump from £9 million in FY20), while its operating profit hit £31 million (down from £40 million in the previous year).
LV= reported a Solvency II operating capital generation of £110 million for the full-year FY21, a significant jump from only £103 million in the previous financial year. Its group Solvency II capital coverage ratio for the same period increased to 187%, from 198% in FY20.
Commenting on the insurer’s financial performance, LV= chief executive Mark Hartigan said: “Over the past two years, we have driven up premium volumes, gained market share, and reduced costs and, through this, improved the commercial outcomes of the business and enhanced its sustainability. We have refocused the business to serve mass affluent customers providing financial resilience for families.
“I would like to thank all of our people who have worked so hard to support our customers and advisers over the last 12 months. LV= is a great business, and we’re determined to build a successful future.”
Hartigan further revealed that LV= shared £38 million with its with-profits members through a mutual bonus of £28 million and an exit bonus of £10 million, introduced following the sale of its general insurance business.
