LV profits up 4% and new protection line planned

LV profits up 4% and new protection line planned

Retirement sales at LV were up 15 per cent in the first half of this year driven by an increase in demand for income drawdown.

The firm’s life business operating profit also increased to £12m for the first half of this year, compared with a £5m operating loss for the first half of 2014.

Meanwhile, new business contribution more than doubled from £6m to £13m.

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Mike Rogers, group chief executive of LV, said the impact of the 2014 Budget had led to a change in buying behaviour, with more pension savers shopping around for retirement income solutions.

He said pensions performed particularly well due to an increased demand for the drawdown proposition, with sales up 45 per cent on this time last year.

Flexible guarantee bonds also proved popular with those approaching retirement, resulting in year-on-year sales increasing by 136 per cent.

Even sales of fixed term annuities were up by 18 per cent, which Mr Rogers said supports LV’s view that annuities will continue to play a role in helping retirees to fund their retirement.

The protection business saw sales increase by 50 per cent across all core lines, including income protection, critical illness and term. Mr Rogers said LV plans to build on the existing suite of products and broaden the offering by entering the business protection market later this year.

The firm’s equity release proposition saw a sales fall, however, to £33m in the first half of this year, from £57m during the same period in 2014.