22 LV= Annual Report 2012
Life Business
Richard Rowney
Managing Director of Life and Pensions
We are the market leader in advised income
protection and a top three provider for pension
drawdown, enhanced annuities and equity release.
Review of 2012 This was achieved against a challenging regulatory
2012 was another strong year for the life business backdrop for the life and pensions industry as a
as we increased year-on-year sales to record levels whole, driven by the implementation of a number
across a number of key business lines. Total sales of regulatory and legislative changes including the
for 2012 were £157 million, a 15% increase on the retail distribution review (RDR).
previous 12 months.
We have maintained strong cost disciplines, with
costs as a percentage of our liabilities improving
Our strategy of remaining focused on market
from 4.2% to 3.6%.
segments with attractive margins and good
growth potential where we have relative scale and Within our results we have strengthened our
expertise, has resulted in a continued strengthening assumptions for the credit default risk which is
of our market share positions. integral to the yield on bond investments that back
our enhanced annuity business.
As a result of the strong performance we delivered a
7% increase in underlying operating profit to £26.3 This strengthening of assumptions has been
million. £11.2 million of this was generated in our offset by benefits from more favourable economic
retirement solutions business and £15.1 million conditions, which remain challenging, but saw credit
was within our protection business. spreads narrow during the year.