.jpg)
Business and profits appear to be booming at life and pensions business Royal London.
The UK insurer revealed its full-year results today and announced that business was up 38% - recording £12,002 million compared to the prior year’s £8,886 million. Its funds under management were up 14% to £114 billion, while European embedded value operating profit before tax increased by 17% to £329 million. Overall, its new business margins were broadly in line with the prior period – at 1.8% compared to the prior year’s 1.9%.
Focusing on the retail life insurance market, intermediary protection new business sales rose by 25% to stand at £807 million with the company stating it has “become one of the leading providers in the intermediated retail life assurance market.”
“We have achieved this through a market-leading and customer-centric proposition and by continuously improving our service for customers and advisers,” it said. “Our focus has been on making it easier for customers to buy insurance and making the products more accessible to groups of customers who have historically been underserved by the insurance industry.”
In addition, on the consumer side of the business, the firm pointed to successful partnerships with the likes of Ecclesiastical Insurance, Co-Operative Funeral Services and its first full-year of partnership with the Post Office, which saw more than 14,000 policies sold. The company also reached an agreement in December 2017 to form a new relationship with CYBG plc, owner of Clydesdale Bank and Yorkshire Bank, to offer over 50s life cover to their customers.
Phil Loney, the firm’s group chief executive, was upbeat about the company’s results but did take the announcement as an opportunity to call on the Government to make a long-term commitment over pensions tax relief.
“The backdrop to much of our business is the political agenda for longer term saving,” he said. “The pensions landscape has seen revolutionary and largely positive changes, but more can be done to deliver real consumer benefits. Auto-enrolment has enabled millions of people to contribute to a private pension for the first time, but the Government’s 8% combined contribution target is only a starting point and contributions need to be increased further over time. The Government also needs to widen the net to bring in self-employed people.
“However, there is one area where we need stability. Pensions tax relief has been subject to no less than six cuts in the last seven years and we are asking the Government to commit to a five-year moratorium on further changes. This would help to support consumer confidence in pensions just at the time that employer and employee contribution rates are set to increase as part of the auto-enrolment project.”
