Royal London D2C business quadruples

Royal London D2C business quadruples

Royal London saw fresh business for its direct-to-consumer (D2C) products surge by 385 per cent last year, marking a record-breaking 12 months for the insurer.

The company’s full-year results revealed a leap in demand for its D2C services, with new business volumes reaching £165m on 31 December 2015, against 2014’s figure of £34m.

According to the report, this dramatic increase was helped by the firm injecting further investment into targeting non-advised consumers, and the launch of simple direct application life insurance products last year.

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Royal London also revealed that volumes for its intermediary pensions business were up 37 per cent, jumping to £6bn in 2015 from £4.5bn the previous year.

Intermediary protection volumes almost doubled compared with the 2014 figure, reaching £502m from £336m.

Phil Loney, group chief executive of Royal London, said it was “pleasing” that sales of protection products through intermediaries were now “surging ahead”.

New business profit for the whole business was up 61 per cent on 2014 at £137m, boosted by sales of group pensions and income drawdown products.

Its asset management arm, Royal London Asset Management saw a downturn in new business inflows.

The report cited new business inflows of £3.1bn in 2015, down from 2014 when inflows reached £3.8bn.

Adviser view:

Matthew Harris, director of Cowdenbeath-based Dalbeath Financial Planning, denied that direct-to-consumer business threatened the financial advice profession.

HE said: “Some consumers prefer to purchase pension and life insurance products directly, but others prefer to get professional independent financial advice first.

“As for getting an IFA to provide life insurance advice, this is usually completely free to the consumer anyway. There is a healthy future for both the direct and advised sales channels.”

Year to

31 Dec 2015

Present value of new business premiums (£m)New business contribution (£m)
Protection 50242.3
Total life and pensions business6,774135.6