United Kingdom Insurance 5 Mar 24 – INDUSTRY SNAPSHOTS
Insurance Business - Report unveils AI's dual impact on insurance industry -
Global Insurance Law Connect (GILC) has unveiled its first report on the integration of artificial intelligence within the insurance industry, offering a comprehensive analysis from 18 countries.
For the complete story, see:
Reuters -
British home and motor insurer
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Insurance Business - ABI outlines industry plan against motor insurance costs -
Following last year's 25% rise in motor insurance premiums, the
For the complete story, see:
Other Stories
BNN Breaking -
Extinction Rebellion - Extinction Rebellion protesters occupy insurance firms insuring climate chaos -
Risk Net -
IPE -
Media Release
No new media release for this week.
Multi-objective reference point techniques to optimize profitability, growth, and risk in the non-life insurance industry: international analysis - By Ana Isabel González-Fernández,
Industry Overview
United Kingdom Insurance Industry
Overviews of Leading Companies
LV =
Associate:
News and Commentary
Insurance Business - Report unveils AI's dual impact on insurance industry -
Global Insurance Law Connect (GILC) has unveiled its first report on the integration of artificial intelligence within the insurance industry, offering a comprehensive analysis from 18 countries.
For the complete story, see:
Reuters -
British home and motor insurer
For the complete story, see:
Insurance Business - ABI outlines industry plan against motor insurance costs -
Following last year's 25% rise in motor insurance premiums, the
For the complete story, see:
BNN Breaking -
The
For the complete story, see:
Extinction Rebellion - Extinction Rebellion protesters occupy insurance firms insuring climate chaos -
Extinction Rebellion activists today (Tuesday) occupied the offices of five major insurers in the heart of the
For the complete story, see:
Risk Net -
Firm joins
For the complete story, see:
https://www.risk.net/investing/7959040/royal-london-to-enter-uk-buyout-market
IPE -
For the complete story, see:
Despite a recent blow-up involving private equity owners, there are compelling reasons for asset managers and alts houses to link with the insurance industry.
For the complete story, see:
Media Releases
No new media release for this week.
Multi-objective reference point techniques to optimize profitability, growth, and risk in the non-life insurance industry: international analysis.
Ana Isabel González-Fernández,
Abstract
This paper combines reference point techniques and econometric analyses to provide the profile of non-life insurers that simultaneously optimize the strategic growth, profitability, and risk goals. The econometric analyses provide the relevant relations among the variables. Non-life insurers from 33
https://onlinelibrary.wiley.com/doi/full/10.1111/itor.13155
The Industry
The industry response to COVID-19
The COVID-19 outbreak is unprecedented in modern times and has been a significant challenge to the
Insurers have been managing an unprecedented level of activity in response to COVID-19 with some members reporting around a 200% increase in query volume to call centres compared to
Contributing to the economic recovery
The
The role of the industry in the recovery can already be seen through the £10billion re-insurance agreement with Government to support trade credit insurance, which will be essential to supporting supply chains as the economy re-opens. As lockdown restrictions are eased and businesses start going back to work, insurers also working with their business customers to help support a safe return to the workplace through risk management guidance. Insurers will continue to support their customers with advice as the situation develops.
The City
In response to the unprecedented economic impact of the COVID-19 crisis. The City
Source:
For the full report, see -
How Our Industry is Regulated
The twin peak regulators
In 2013, the government implemented wide-ranging reforms to the way the financial services sector - including insurance - is regulated. The body which regulated the
Prudential Regulatory Authority
(PRA), which is part of the
Financial Conduct Authority
(FCA) regulates how these firms behave, as well as more broadly the integrity of the
The ABI is not a regulator, but we do seek to engage closely with both the PRA and
The ABI Prudential Regulation team focuses on a range of prudential and financial reporting issues of importance to our members, including Solvency II, international prudential regulatory developments, financial reporting standards and the regulatory environment for institutional investors.
The ABI Conduct Regulation team focuses on a range of conduct policy issues of importance to our members. These include European initiatives such as the Insurance Distribution Directive (IDD) and General Data Protection Regulation (GDPR) and
uphold information rights in the public interest
, promoting openness by public bodies and data privacy for individuals. Part of its role is to improve information rights practices by gathering and dealing with concerns raised by members of the public. It is also responsible for overseeing the
There are a number of other bodies with responsibilities for the financial services sector to which the ABI also makes representations:
If you have a complaint about the way you have been treated by a financial services firm, you should complain directly to the firm - through their formal complaints procedure - in the first instance. They are obliged by the
If you're not happy with the outcome you can take your complaint to the FOS. The FOS is an independent body which aims to settle complaints between consumers and businesses providing financial services. There is no charge to the consumer for using this service.
The
You may be entitled to compensation from the scheme if the firm cannot pay claims made against it. This depends on the type of business and the circumstances of the claim. There is no charge to the consumer for using this service
Source:
For full report, see:
https://www.abi.org.uk/data-and-resources/tools-and-resources/regulation/
About us
The
The ABI represents over 200 member companies, including most household names and specialist providers, giving peace of mind to customers across the
The
helps
is responsible for more than 300,000 jobs in an industry which is highly skilled and global
provides peace of mind to businesses and families across the
enables exports and invests in new technologies that will secure
The ABI:
has over 200 member companies, including most household names and specialist providers
was formed in 1985 and is funded by members' subscriptions on a not-for-profit basis
our members are major tax contributors, paying nearly £12 billion to the government
all our members agree to our compulsory codes of conduct
Our role is to:
get the right people together to help inform public policy debates, engaging with politicians, policymakers and regulators at home and abroad.
be the public voice of the sector, promoting the value of its products and highlighting its importance to the wider economy
help encourage consumer understanding of the sector's products and practices
support a competitive insurance industry, in the
We do not sell insurance, nor are we regulators of the sector.
Source:
https://www.abi.org.uk/about-the-abi/about-us/
Leading Companies
ABOUT US
We are a leading international savings, retirement, and insurance business. We aim to earn customers' trust as the best place to save for the future, navigate retirement and insure what matters most to them.
£33.2 billion
-paid out in benefits and claims to customers in 2019
£522 billion
total group assets under management (HY20)
33.4 million
customers in 2019
million
logins to MyAviva (1H20)
£6 billion
invested in green assets since 2015 (eg green bonds, solar & wind)
£12.0 billion
solvency II capital surplus (HY20)
Our portfolio of businesses
We offer a wide range of insurance and savings products which help people to protect what's important and save for a more comfortable future.
Investment, Savings and Retirement
Annuities and Equity Release, Protection, Health, Heritage
Europe Life
Asia Life
https://www.aviva.com/content/dam/aviva-corporate/documents/about-us/about-aviva-september-2020.pdf
OUR STRATEGY
We will focus on those markets or products where we have the necessary size, capability and brilliant customer service to generate superior shareholder returns.
FOCUS
We will focus on the
TRANSFORM
We have fantastic franchises and exceptional long-term relationships with customers and distributors, but these strengths must be translated into superior financial performance for our shareholders. As customer expectations and preferences change, delivering profitable growth will require us to transform customer experiences and provide excellent value for money. We have strong foundations, particularly in the
FINANCIAL STRENGTH
Financial strength, resilience and sustainability will be a critical underpin for our strategy. We have maintained capital strength, built central liquidity and made good progress in reducing debt leverage in recent years. In conjunction with actions to focus the portfolio, our financial flexibility will increase. This will enable us to further strengthen our financial position and will give us options to invest in our businesses and provide returns to shareholders.
OUR TARGETS ARE
Solvency II return on equity: 12% by 2022
Cash inflows to centre: £8.5-9.0 billion 2019-2022
Operating capital generation: c£7.5 billion 2019-2022 net of interest and centre cost.
Cost reduction: £300 million net savings by 2022
Debt leverage: £1.5 billion debt reduction 2019-2022
https://www.aviva.com/investors/our-strategy/
Strong 2022 results, operating momentum continues
Announcing share buyback of £300m1. Total capital return over £5bn since 2021
On track to meet or exceed Group targets, outlook remains positive
"We are making excellent progress at Aviva. Operating profits and dividends are growing and we have strong trading momentum despite significant market volatility. We have radically simplified Aviva, we are financially strong and we are utterly focused on transforming and growing the business.
"Our core businesses in the
"Cash remittances2 are up strongly, our capital position is robust, and we are today declaring a final dividend of
"The diversified model we have built at Aviva has proved its worth, providing clear benefits for customers and shareholders and driving our great results last year. Whilst I am pleased with what's been accomplished over the past twelve months, I am clear there is significantly more value which Aviva can and will deliver in 2023 and beyond."
Strong results demonstrating benefits of diversified business model
General insurance gross written premiums (GWP) up 8%7 to £9,749m (20212: £8,807m) and COR‡ of 94.6% (20212: 92.9%)
Operating profit‡,4 up 35% to £2,213m (20212: £1,634m)
Solvency II operating own funds generation‡ up 37% to £1,623m (20212: £1,187m)
Solvency II return on equity‡ 16.4% (20212: 10.7%)
Cash remittances‡ up 11% to £1,845m (20212: £1,662m)
Baseline controllable costs‡,5 down 3% to £2,771m (20212: £2,854m) reflecting continued focus on efficiency
IFRS loss of £(1,139)m (2021: £2,036m profit) largely reflects adverse market movements
Final dividend per share of 20.70p (2021: 14.70p). Total dividend per share of 31.00p (2021: 22.05p), as per previous guidance.
Capital position remains robust - £300m share buyback to commence immediately
Solvency II shareholder cover ratio‡ of 212% (2021: 244%) and centre liquidity‡ (
Estimated Solvency II shareholder cover ratio pro forma for further debt reduction and pension scheme payment of 207%. Allowing for payment of the 2022 final dividend and the £300m share buyback the ratio is estimated at 196%.
Solvency II debt leverage ratio‡ of 31% (2021: 27%), and 30% on a pro forma basis for further debt reduction and pension scheme payment.
Given our robust capital position, we are commencing a £300m share buyback programme immediately1. Our preference remains to return surplus capital regularly and sustainably.
Continuing strong operating momentum
Wealth proved resilient in challenging market conditions with net flows‡ of £9.1bn (2021: £10.0bn) benefitting from strong performance in Workplace which added 374 new schemes in the year.
Annuities & Equity release sales6 were 21% lower at £6,238m (2021: £7,887m) with Solvency II OFG‡ up 34% to £524m (2021: £392m). The outlook for BPA volumes is positive and we are confident in meeting our £15-£20bn volume target over 2022-24.
Protection & Health VNB‡ up 18% to £221m (2021: £188m) reflecting strong sales, improved margins and beneficial assumption changes, partly offset by the negative impact from higher interest rates.
Canada GWP up 16% (9% at constant currency) to £4,009m (2021: £3,455m) and a COR‡ of 92.5% (2021: 90.7%). We saw excellent growth in both commercial and personal lines with GWP up 14% and 6% respectively at constant currency.
https://www.aviva.com/newsroom/news-releases/2023/03/FY2022-results-announcement/
About Us
We are a responsible and profitable company engaged in the management of Life and Pension policies in the
,
and
Netherlands
.
The Group initially consisted of Countrywide Assured, a closed Life and Pensions book demerged from
Since incorporation the Group has grown through the acquisition of three predominantly closed
What We Do
We administer c.0.9 million life and pensions policies for our policyholders; 260,000 in the
, 350,000 in
and 290,000 in
Netherlands
.
We manage £7.8bn of funds; £2.4bn in the
We operate to high regulatory standards, ensuring we offer effective service levels and strong solvency levels as we aim to deliver fair outcomes to policyholders.
We provide value to shareholders primarily by way of an established and attractive dividend strategy but also by value enhancement through acquisitions and the writing of profitable new business in
We are committed to delivering our stated strategic objectives:
Maximizing value from our existing businesses.
Making further life and pensions acquisitions where they meet stringent assessment criteria.
Value enhancement through the writing of profitable new business
https://www.chesnara.co.uk/about-us/who-we-are
Full Year 2021 Results
KEY STRENGTHS OF THE CHESNARA STORY AND DEVELOPMENT OVER 2021
Long track record of building Economic Value, supporting sustainable long-term cash generation and shareholder dividends
Significant pre-dividend EcV growth across all divisions including new business profits of £10m
Dividend increase of 3%, supported by commercial cash generation to dividend coverage of 156%
Strong Solvency II position with high resilience to market volatility
Strong and stable solvency of 152% (post dividend), without transitional measures
Balance sheet flexibility which supports our M&A strategy
Disciplined yet flexible M&A framework with proven track record of delivery, integration and growth within both open and closed businesses
Two value adding acquisitions announced in the year: estimated EcV gain of £13m and additional steady state cash generation of approximately £6m (2) per annum
Continue to be optimistic about our ability to execute further accretive acquisitions
Experienced management team focused on shareholder value creation
New CEO appointment and a newly created position of Head of
Two new Board appointments strengthen European experience and bring further M&A experience
FINANCIAL OUTCOMES: HIGHLIGHTS
Financial performance
2021
2020
Dividends
Dividends per share (1)
22.60p
21.94p
Cash
Commercial cash generation (2)
£53.0m
£27.7m
Group cash generation
£20.3m
£27.7m
Economic value
Economic value earnings (3)
£20.7m
(£0.9m)
IFRS
Profit before tax
£28.8m
£24.6m
New business
Commercial new business profit
£9.6m
£10.5m
Incremental long term cash generation (4)
£18.6m
£20.7m
Financial position
2021
2021
forma (5)
Solvency ratio
152%
182%
156%
Solvency
Solvency surplus
£190.7m
£344.1m
£204.0m
Economic value
Economic value
£624.2m
£636.9m
£636.8m
Economic value per share
£4.16
£4.24
£4.24
Assets
Assets under management
£9.1bn
£12.3bn
£8.5bn
Leverage
Leverage ratio (6)
6.4%
30.4%
7.4%
For full financial report, see:
The parent company of the
https://www.directlinegroup.co.uk/en/brands.html
GROUP PROFILE
Our vision is to create a world where insurance is personal, inclusive and a force for good. Our purpose is to help people carry on with their lives, giving them peace of mind now and in the future.
OUR PROPOSITION
We have multiple brands, products, and distribution channels. These enable our customers to choose the right cover to protect their cars, homes, holidays, businesses, and pets.
MOTOR
We are
HOME
We are one of
RESCUE AND OTHER PERSONAL LINES
We are one of the leading providers of rescue, travel, and pet insurance in the
COMMERCIAL
We protect commercial businesses through our brands, NIG,
https://www.directlinegroup.co.uk/en/who-we-are/group-profile.html
BRANDS
Launched in 1985 by Sir
CHURCHILL
Founded in 1989 by
GREEN FLAG
Green Flag started in 1971 as an idea between friends Bob Slicer and
NIG
NIG provides commercial insurance throughout the
NIG sells its product exclusively through independent brokers operating across the
https://www.directlinegroup.co.uk/en/who-we-are/our-story.html
TRADING UPDATE FOR Q1 2023
Trading update
During the quarter we continued to take pricing action in Motor to improve our margins and made good progress towards target margins across the Motor portfolio. As a result, average renewal premiums in Q1 increased by 19% compared to Q1 2022, reflecting premium rate increases during 2022 and in Q1 2023. Focusing on margin led to a reduction of in-force policies of 2.5% across the quarter and despite this gross written premium increased by 3.3% in Q1 2023.
In Commercial, the strong premium growth seen in 2022 continued in Q1 2023 with gross written premium growth of 27.6% in Q1 driven by both direct own brands and NIG and other. In Home, we observed significant price increases across the market. Our Home gross written premium grew by 2.1% with policy count stable across Q1.
Claims and reserving
We have experienced further adverse claims development in respect of late 2022 and early 2023 in Motor (including Commercial Motor) particularly in relation to damage. This is expected to put pressure on earnings in 2023 including from prior-year reserve releases.
We incurred modest weather event claims during the first quarter, well within the 2023 full year assumption of £80 million.
Our forward view of claims inflation remains unchanged at high single digits across Motor and Home, albeit there continues to be a range of potential outcomes depending on future economic conditions.
Investments
Group total investment return was £70.9 million in Q1 of which £37.0 million related to net investment income and £33.9 million related to the movement in realised and unrealised gains. The annualised investment income yield was 3.2% as at the end of
Capital
The Group's estimated solvency capital ratio on 31 March was broadly unchanged compared with year end, as the majority of credit spread narrowing early in the quarter unwound during March. As previously set out, we expect to benefit from several capital tailwinds, including a reduction in ineligible capital on the adoption of IFRS 17 and the pull to par effect on our bond portfolio, which are now expected to be recognised over the remainder of 2023. In addition, self-help actions continue to be explored, as we set out with our full year results.
"Trading has been positive over the first quarter with premium growth across Motor, Home and Commercial and this trend has continued into April. Our focus continues to be on restoring the capital strength of the Group and improving Motor margins, where we have made good progress. Whilst 2023 earnings outlook continues to be challenging, the Group has many strengths, and we continue to take the actions required to drive business performance. Our ambition over time to generate a net insurance margin of above 10% remains."
For full financial report, see:
ABOUT US
For nearly 200 years we have provided financial services to customers across the
Our purpose is to improve the lives of our customers, build a better society for the long term and create value for our shareholders.
WHAT WE DO
We are built on understanding people, how long they live, what risks they are comfortable with and their changing needs throughout life.
£1tn+ Assets under management
The
Number 1 provider of
RETIREMENT INSTITUTIONAL (LGRI)
Works with companies, pension fund trustees and advisers to protect the corporate pensions of people who are in, or are approaching retirement by providing secure pension incomes.
RETIREMENT RETAIL (LGRR)
Helps individual customers who are looking for financial security in later life by providing annuities and lifetime mortgages.
LEGAL &
Manages shareholder and customer assets, aiming to improve returns through putting money into direct investments.
INVESTMENT MANAGEMENT (LGIM)
We provide investment management services for many of the
We are the
INSURANCE (LGI)
For nearly 200 years, our insurance business has helped people safeguard their families' financial futures through providing insurance covering life, critical illness, disability and long-term sickness.
https://www.legalandgeneralgroup.com/about-us/
H1 2022 Results: Continued strong performance -8% growth in Operating profit and EPS, 21% ROE and SII coverage ratio of 212%
Continued delivery of strong financial performance
Operating profit of £1,160m, up 8% (H1 2021: £1,079m)
Earnings per share of 19.28p, up 8% on H1 2021 (17.78p)
Profit after tax2 of £1,153m (H1 2021: £1,065m) and return on equity of 21.3% (H1 2021: 22.0%)
Solvency II coverage ratio3 of 212% (H1 2021: 182%)
Interim dividend of 5.44p, up 5% (H1 2021: 5.18p)
Growing contribution to our five-year (2020-2024) ambitions4
Cash generation of £1.0bn, up 22% year on year. Capital generation of £0.9bn, up 14% year on year
Cumulative cash and capital generation of £4.3bn and £4.1bn respectively, against our ambition of £8.0-9.0bn by 2024
Cumulative dividends declared £2.5bn (H1 2022: £324m, 2020-21 £2,147m) against our ambition of £5.6-5.9bn by 2024
Strong PRT new business volumes and LGIM net flows
Global PRT new business premiums of £4.4bn (H1 2021: £3.1bn), including our largest ever US transaction
LGIM record H1 external net flows of £65.6bn (H1 2021: £27.4bn), with AUM down to £1.3tn due to market movements
Protection premiums of £1,605m (H1 2021: £1,500m) and Individual annuity premiums of £453m (H1 2021: £483m)
A strong and resilient balance sheet
No defaults in H1 or for the last 13 years. £2.7bn credit default provision remains unutilised5
99% investment grade £73.2bn annuity bond portfolio
100% of scheduled cashflows received from our Direct Investments
Strong and growing IFRS and Solvency II balance sheet
Long-term, growth-oriented, and highly synergistic business model
An established track record: HY11 to HY22 CAGR of 11% in EPS, 11% in DPS and 8% in book value per share
Highly synergistic: four focused divisions that create a virtuous circle of internal demand and supply, supporting c20% ROE
Long-term and predictable value creation: 40+ year duration business with earnings driven by a growing stock of assets
Attractive global growth markets: retirement solutions ($57tn), asset management ($149tn), climate change ($20tn)6
A longstanding commitment to Inclusive Capitalism and a leader in ESG: rated #1 Life & Health insurer by ShareAction
"We've made a good start to the year, with operating profit and EPS up 8%, cash and capital generation up double digits, DPS up 5% and a return on equity of 21%. We have delivered for our institutional clients and retail customers, while generating good volumes and margins in a buoyant PRT market and continuing to scale LGC at pace - both in the
Financial summary
£m
H1 2022
H1 2021
Growth %
Analysis of operating profit
Legal & General Retirement Institutional (LGRI)
560
525
7
263
250
5
200
204
(2)
Retail1
332
292
14
Operating profit from divisions
1,355
1,271
7
Group debt costs
(108)
(120)
10
Group investment projects and expenses
(87)
(72)
(21)
Operating profit2
1,160
1,079
8
Investment and other variances (incl. minority interests)
207
241
n/a
Profit before tax attributable to equity holders3
1,367
1,320
4
Profit after tax attributable to equity holders
1,153
1,065
8
Earnings per share (p)
19.28
17.78
8
Book value per share (p)
186
164
13
Interim dividend per share (p)
5.44
5.18
5
H1 2022 Financial performance Income statement
Year to date operating performance is in line with our expectations, with H1 2022 operating profit up 8% to £1,160m (H1 2021: £1,079m). All four of our divisions are well positioned to execute on compelling structural market opportunities to deliver further profitable growth over the medium and long-term, notwithstanding market volatility.
LGRI delivered operating profit growth of 7% to £560m (H1 2021: £525m), underpinned by the performance of our annuity portfolio. We executed well, writing £4,449m of global PRT at attractive Solvency II new business margins of 8.7%.
LGC operating profit increased 5% to £263m (H1 2021: £250m), driven by strong performance in our alternative asset portfolio. Our housing businesses - notably
LGIM delivered operating profit of £200m (H1 2021: £204m), a resilient result in light of market conditions. Assets under management decreased to £1,289.7bn (H1 2021: £1,326.8bn). However, external net flows were strong: £65.6bn (H1 2021: £27.4bn), of which over half were from International clients, and with continued growth in higher margin areas such as thematic ETFs, fixed income, and multi-asset. The cost income ratio (59%) reflects the impact of challenged markets on revenue (H1 2021: 58%).
Retail operating profit increased 14% to £332m (H1 2021: £292m), driven by the on-going release from operations from the growing
Profit before tax attributable to equity holders2 was £1,367m (H1 2021: £1,320m), reflecting positive investment variance of £207m (H1 2021: £241m). The key drivers of this positive investment variance are from the formulaic impact of rising interest rates on the Insurance reserves and strong portfolio performance in the annuity portfolio, partially offset by volatile global equity markets impacting LGC.
Balance sheet and asset portfolio
The Group's Solvency II operational surplus generation was up 14% at £946m (H1 2021: £831m). New business strain was £(121)m (H1 2021: £(158)m) which results in net surplus generation of £825m (H1 2021: £673m).
The Group reported a Solvency II coverage ratio3 of 212% at H1 2022 (FY 2021: 187%, H1 2021: 182%) which, in addition to the contribution from net surplus generation, reflects the impact of market movements, principally from the non-economic impact of higher interest rates on the valuation of our balance sheet4, partially offset by payment of the 2021 final dividend (£792m).
Our IFRS return on equity of 21.3% (H1 2021: 22.0%) reflects the continued strong performance of our business.5
Our diversified, actively managed annuity portfolio has continued to perform resiliently with no defaults. The annuity portfolio's direct investments continue to perform strongly, with 100% of scheduled cash-flows paid year to date, reflecting the high quality of our counterparty exposure.
Group Strategy
Division
Provision
Description
LGRI
Retirement Solutions
A leading international manager of institutional Pension Risk Transfer (PRT) business
LGC
Asset Origination
An alternative asset origination platform generating attractive shareholder returns
LGIM
Asset Management
A global £1.3tn asset manager with deep expertise in DB and DC pensions
Retail*
Retirement & Protection Solutions
A leading provider of
A powerful business model
We have a unique and highly synergistic business model, which continues to drive our strong return on equity.
LGRI is a market leader in
LGC invests across four main asset classes (
LGIM is a leading global asset manager, ranking 11th in the world6 with £1.3tn of AUM of which £468bn, or 36%, are International assets. LGIM is a leading provider of
Retail is a leading provider of
The synergies within and across our businesses drive profits and fuel future growth. The establishment of our Retail division is enabling us to better serve the needs of our retail customers and drive further synergies.
The integrated nature of our business model means that we have relationships with clients and customers that can and do last for decades. For example, an Index or Liability Driven Investing DB corporate client in LGIM typically becomes a PRT client after 14 years. LGRI will then typically have a relationship with that client for another 30 to 40 years. Equally, Retail Retirement and LGIM may have a 30-40-year relationship with a customer during the DC accumulation phase, and then extend that relationship for another 15-30 years during the decumulation phase across a suite of decumulation products including individual annuities, lifetime mortgages and drawdown.
The Group continues to build out, in a measured fashion, its international retirement solutions franchise. We have made excellent progress in the US over the last decade and will continue to build out our established businesses (LGRI, LGIM, Retail) in that market. LGIM continues to make good progress against its international expansion plans in
A long-term commitment to Sustainability, ESG and Inclusive Capitalism
Our purpose is to improve the lives of customers, build a better society for the long-term and create value for our shareholders. This inspires us to use our assets in an economically, environmentally and socially useful way to benefit society - what we call Inclusive Capitalism. At a time when many in society are facing increasing economic hardship, we believe Inclusive Capitalism matters more than ever.
Our philosophy underpins our approach to Sustainability and to ESG (Environmental, Social, and Governance factors).9 We think about Sustainability, and the long-term ESG impact of our business, in terms of:
How we invest proprietary assets.10 Our ambition is to reduce our proprietary asset portfolio greenhouse gas emission intensity by half by 2030 and to net zero carbon by 2050 and we are on track to set our full suite of science-based targets in 2022 for publication in 2023. In 2021 we reduced the greenhouse gas intensity of the Group's balance sheet by 17.0% versus 2020, although this has been driven in part by COVID-19 and market volatility impacts.11 We continue to make environmentally and socially useful investments. As at H1 2022, we have invested £1.4bn in clean energy and £8.0bn in social infrastructure. For more information please see our latest Climate Report, compliant with recommendations by the
How we influence as one of the world's largest asset managers with £1.3 trillion AUM. We have £271.2bn AUM in ESG strategies and in H1 2022 we cast over 45,000 stewardship votes as we continued to encourage investee companies to behave responsibly.13,14 LGIM is rated A+ for responsible investment strategy & active ownership from the UN Principles for
How our businesses operate. We are committed to supporting our customers, employees, suppliers, shareholders and society at large. In the current economic environment, we recognise that support is more critical now than ever. For information on how we are supporting our stakeholders, see pages 38-52 of our Sustainability report.15 We have committed to reducing the carbon emission intensity of our operating businesses. Our ambition is to operate our offices and business travel with net zero emissions from 2030, and for all our new homes to be net zero operational carbon from 2030. ESG criteria are included in executives' objectives and remuneration schemes.
Outlook
Medium-term growth: ambitious and deliverable
Our strategy has delivered strong returns for our shareholders over time. It has demonstrated resilience through the pandemic and positions us well to navigate - and even benefit from - the prevailing market environment. We are confident we can continue to deliver profitable growth as we execute on our strategy.
We set out our five-year ambitions at our Capital Markets event in
Cash and capital generation significantly to exceed dividends (we intend to generate £8.0bn - £9.0bn of both cash and capital, and to pay dividends of £5.6bn - £5.9bn).17
Earnings per Share to grow faster than dividends, with the dividend growing at low to mid-single digits from 2021.
Net capital surplus generation (i.e., including new business strain) to exceed dividends.
We are now half-way through our ambition period and are on track to achieve or beat our cumulative cash and capital ambitions. In H1 2022, we have achieved 22% growth in cash generation and 14% growth in capital generation. Since the beginning of 2020 to date, we have achieved £4.3bn of cash generation, £4.1bn of capital generation and declared £2.5bn of dividends. We are confident that we will consistently grow cash and capital faster than our dividend commitment. The jaws between net capital surplus generation and the dividend are widening, providing attractive capital optionality. Even zero growth in cash and capital generation from now to 2024 would still see us meet our cash and capital generation ambitions.
We aim to deliver long-term, profitable growth across the Group. Our asset origination and asset management businesses, LGC and LGIM, operate in attractive and profitable markets, and maintain a strong commitment to ESG-aligned investing. With proven asset expertise in specialist commercial real estate, clean energy, housing and SME finance, LGC provides unique asset origination capabilities in sectors that have significant growth potential, which produce yield-creating assets that drive our annuity business and which appeal to third party investors. LGIM offers a range of investment solutions for institutional and wholesale clients and is expanding geographically and into new channels. The annuity portfolios provide highly predictable, stable cash flows from their growing back-books. Retail is applying technological innovation to sustain its
We remain confident in our strategy and in our ability to deliver resilient, organic growth, supported by our strong competitive positioning in attractive and growing markets. Our confidence in our dividend paying capacity is underpinned by the Group's strong balance sheet, which has a £2.7bn IFRS credit default reserve and Solvency II surplus regulatory capital of £9.2bn, significant buffers to absorb a market downturn. We have a proven operating model which is reinforced by robust risk management practices.
Confident in achieving our ambitions
We remain confident in achieving our five-year (2020-2024) cumulative financial ambitions. In H1 2022, we continued to build on the good start we made in 2020 and 2021, delivering double digit growth in both cash and capital generation.
LGC and LGIM provide powerful asset origination and asset management capabilities directly to clients. These same capabilities also underpin our leading retirement and protection solutions. LGC has numerous investment opportunities across underserved asset classes and is continuing to scale the portfolio at pace. LGC intends to grow shareholder alternative AUM to c£5bn, with a blended portfolio return of 10-12%, by 2025. It also aspires to grow third party AUM to £25-30bn and to grow LGC operating profit to £600-700m by 2025. LGIM continues to focus on attracting higher margin net flows and on diversifying and further internationalising its business. The business seeks to grow profits in the range of 3-6% per annum, absent market shocks such as that experienced in the first half of this year.
LGRI wrote good levels of business at strong margins in H1 2022. Demand for global PRT is growing, as rising interest rates and widening credit spreads reduce pension deficits and allow more funds to consider de-risking. As such, advisers such as WTW and LCP are bullish on the prospects for PRT for the rest of 2022 and beyond.18 We are well placed to participate. We continue to expect to write £40-50bn of
In Retail, we continue to target mid-single digit growth in revenues across our
We are pleased with the further progress we have made in H1 2022 and are confident in our ability to deliver further profitable growth going forwards. We are well-positioned to support the
We will continue to maintain a defensive and diversified asset portfolio and a long-term investment horizon, supporting all our stakeholders by delivering Inclusive Capitalism through investments - both for our own portfolio and for clients - in areas such as infrastructure, clean energy and affordable housing, and by providing products to support individuals' financial resilience.
For complete financial report, see:
https://group.legalandgeneral.com/media/iq4bifjz/hy22-press-release_analyst-pack.pdf
LV =
ABOUT US
We're a mutual protection, savings and retirement provider. Our 1,700 people help our customer protect their income while they are working and maximize it when they stop. By doing this we enable people to live confident lives.
We believe that everyone should have access to independent, regulated financial advice. It should not be seen as a luxury for the few who can afford it or who are experienced in using it. Why? Because it provides financial and emotional benefits. Good advice ensures better financial outcomes and frees people from the worry of making complex decisions that could have long-term implications.
We work with a wide range of financial advisers and it is through them that the majority of customers will buy our products and services.
Our 1.28 million customers, 1.25 million of which are members, hold a variety of products with us including life insurance, income protection, investments and retirement income solutions such as equity release, fixed term annuities and drawdown products.
LV= announces 2020 financial results
Strategic and operational highlights
Completed comprehensive strategic review and announced sale to
Increased market share for the first time since 2016.
Made enhancements to Life and Critical Illness Cover as part of continual improvement of the protection suite of products.
Increased digital capability to improve access for advisers including launch of Equity Release portal.
Introduced Covid support for vulnerable customers including payment breaks and premium reductions.
Financial highlights
Group Solvency II capital coverage ratio 198%(i) (FY 2019: 244%).
New business PVNBP £1.3 billion (FY 2019: £ 1.4 billion).
Operating capital generation £103 million (FY 2019: £101 million).
Operating profit £40 million (FY 2019: £16 million loss).
Profit before tax from continuing operations £37 million (FY 2019: £15 million).
"Despite the unprecedented challenges presented by the pandemic, LV= has delivered a good financial performance in 2020. Through the year we have created significant momentum in our trading businesses and I am particularly pleased that we increased market share in both Savings & Retirement and Protection. By taking quick and positive actions in response to Covid-19, as well as delivery of planned change initiatives, we continue to improve service for customers and have strengthened the propositions we offer the market.
"We are reporting a strong Solvency II capital surplus of £690 million(ii) and an increased operating profit of £40 million. I am pleased that we have again been able to share some of the financial benefits with our With-profits members through the allocation of a £28 million pounds mutual bonus. This has been applied by uplifting the asset share of relevant With-profits policies by up to 1%.
"The vast majority of our people have been working from home since the first lockdown in
"During 2020 we completed a significant change agenda and delivered a number of initiatives that helped improve our trading performance. We increased our market share in both the Protection and Savings & Retirement businesses for the first time since 2016.
"In Savings & Retirement our focus has been on developing our
"In our Protection business we launched a number of improvements to our Life and Critical Illness Cover, with Enhanced Children's Cover now available. We also improved our Family Income Benefit offering making it available through an online application. As part of our drive to increase digital capability and ease of access, we launched our Protection Progress Hub for advisers. This provides self-serve capability so that advisers can quickly and easily track new business applications. In addition to the product enhancements and adviser support measures, we also received extremely positive feedback on our response to Covid-19. We took a flexible and personal approach which helped our customers maintain their protection policies through a difficult period. This included initiatives such as payment breaks for our most vulnerable customers and premium and cover reduction options for others."
Financial highlights
FY 2020
FY 2019
Change (%)
Operating profit
£40 million
£ (16) million losses
n/a
Trading profit:
Savings and Retirement
£8 million
£25 million
(68%)
Protection
£2 million
£15 million
(87%)
Heritage
£ (1) million losses
£3 million
n/a
New business sales (PVNBP basis)
£1.29 billion
£1.40 billion
(8%)
Savings and Retirement
£1.04 billion
£1.14 billion
(9%)
Protection
£252 million
£263 million
(4%)
Tough trading conditions adversely impacted both our Savings & Retirement and Protection businesses resulting in lower volumes and margins. In Savings & Retirement new business sales were £1,039 million (FY 2019: £1,143 million) and in Protection new business sales were £252 million (FY 2019: £263 million). Savings & Retirement generated £8 million of trading profit (FY 2019: £25 million) and Protection £2 million of trading profit (FY 2019: £15 million).
Our Heritage business includes ordinary branch and industrial branch with-profits policies along with some non-profit business. Our main With-profits fund delivered strong returns of 8.9% (FY 2019: 14.5%), outperforming the benchmark of 6.2%.
Operating profit of £40 million (FY 2019: £16 million loss) benefited from investment income of £15 million (FY 2019: £8 million) and favourable reserving changes of £16 million (FY 2019: £67 million adverse).
Profit before tax from continuing operations of £37 million (FY 2019: £15 million) contains non-operating spend of £96 million (FY 2019: £98 million) offset by favourable short-term investment fluctuations of £93 million (FY 2019: £129 million).
Operating capital generation of £103 million (FY 2019: £101 million) includes £58 million (FY 2019: £87 million) from our trading businesses. The Solvency II capital surplus has decreased by £254 million to £690 million(iii) (FY 2019: £944 million), reducing our Capital Coverage Ratio to 198% (FY 2019: 244%), at this level it is still at the top of our risk appetite range of 140% - 200%. The reduction was driven by distributions to members which included the introduction of an exit bonus, further de-risking of the pension scheme and economic variances largely driven by falling swap rates which are offset by TMTP movements.
Targeted operating expenses increased to £108 million (FY 2019: £99 million) as we took back our share of overheads previously allocated to the general insurance business. While we anticipated an increase in the region of £16 million at the start of the year, our ongoing cost control initiatives restricted the increase to £9 million. Restructuring to realign our cost base to reflect the reduction in size of the business will continue going forward. It is expected that this will reduce targeted operating expenses in future years to below £100 million.
Every year the Board reviews its strategic objectives and long-term plans. This year was our first full year trading as a stand-alone Life and Pensions business and it was especially important in these circumstances that the Board continue to be driven by its primary objective to act in the best long-term interests of our 1.25 million members.
To remain competitive LV= requires long-term access to capital for investment. This requirement meant there was insufficient internal capital to both invest sufficiently and ensure the interests of With-profits members are met. This led to a comprehensive and rigorous review to assess the strategic options available to the business. It concluded that continuing to fund investment in the new business franchise from the estate would not be in the best interests of our With-profits members. After careful consideration taking much of the year, the Board was unanimous in its decision to pursue a transaction with
"Success in 2021 will be determined by three simple objectives; to deliver the transaction with
https://www.lv.com/about-us/press/lv-announces-2020-financial-results
ABOUT US
When seven farmers from the
It's our mutuality which sets us apart. We're owned and run for you, over 900,00 members, and we work hard to protect your interests. From our 300 local offices offering personal service to our tailored quotes you can't get on price comparison sites; your needs are at the heart of everything we do.
Gaining accolades is one way of being recognized for the high standards of customer service and cover which we provide. Many of our general insurance products have received the maximum 5 Star Rating from
But we're not standing still. Supporting our communities is very important to us. We're committed to helping protect the environment, championing rural communities through events and initiatives, and continuing to offer the best care possible for you, our members. We've come a long way in the last century, and we're looking forward to the next one.
Over a century's experience protecting the countryside
Over 300 local offices offering personal, tailored care
No cancellation, mid-term or Direct-Debit fees on any of our insurance policies
https://www.nfumutual.co.uk/news-and-stories/why-choose-nfu-mutual/
2020 ANNUAL GENERAL MEETING (AGM)
NFU CHAIRMAN, JIM McLaren ANNOUNCED:
Despite our AGM being held under very different circumstances this year due to the Coronavirus pandemic it still gives me great pleasure to present my first annual report as Chairman of
In 2019, on the back of what was a challenging year for the farming industry and the wider business community, NFU
Mutual performed well and I'm happy to report another sound set of results and an overall group profit of
£573m.
another strong performance in 2019 resulting in an underwriting profit of £167m with a combination of premium growth and lower levels of claims incurred. This is the ninth consecutive year of delivering an underwriting profit.
GWPI reached £1,648m showing a 5.1% increase over the previous year.
Our exceptional persistency continued in 2019 with 95.3% of members choosing to renew their policies with us, an achievement we're particularly proud of. We continue to set ourselves apart from the competition by recognizing our customers' loyalty through Mutual Bonus - a discount applied to your
In 2019 we provided a total of £258m in Mutual Bonus to our members. As we move through 2020, we will continue to support our customers and expect to provide £250m in Mutual Bonus from
Moving on to new business written during the year, this totaled £105.8m, representing an 8.3% increase with strong performance across all lines of business.
Our prudent management of costs, sound and fair claims handling, accurate pricing and risk selection resulted in a Combined Operating Ratio (COR) of 88.9%. On a longer-term 10-year basis the average COR continues to be within our 98% target. Group funds under management increased to £20.8bn reflecting the upturn in investment markets. The General Business fund achieved a return of 10.7% and the three-year annualized return was a healthy 5.1%.
These results are testimony to our long-term objective of sustainable profitable growth. It's this long-term focus that ensures our business remains resilient during these continued turbulent times with the worldwide Coronavirus outbreak.
Our pensions and investment business performed well in very challenging market conditions. Low consumer confidence seen across the industry led to us returning an Annual Premium Equivalent (APE) result of £60.1m.
Like all businesses,
As a farmer myself, I understand the ongoing challenges for the agricultural industry and the vital role we have to play right now. In 2019 we donated £7m to support the farming unions across the
The role played by our staff along with our Agents and their staff is vital in providing our customers with the first-class service they have come to expect. I would personally like to thank everyone for their hard work and dedication.
Coronavirus continues to have a huge impact on everybody, including our customers and their local communities. Over the last few months, we've committed to a £32m package of support including updates to pricing, cover, and claims, as well as increased funding allocated to local organizations via our agencies.
We know that many of our customers have been affected by this outbreak and a significant number of them are key workers, responsible for helping to feed and support the nation in difficult circumstances. On behalf of NFU Mutual I would like to thank you for all you are doing for the country.
We will continue to support our customers through this crisis and 2020 will be another challenging year for us all. As a company with a strong balance sheet that invests for the long-term, with our dedicated staff and loyal members,
Our members and their loyalty will always be a great source of pride for us. I would also like to thank you for your continued support and for choosing
https://www.nfumutual.co.uk/news-and-stories/agm-results-2020/
2020 FINANCIAL HIGHLIGHTS BASED ON AGM
NFU overall group profit of £573m from 2019
Another strong performance in 2019 resulting in an underwriting profit of £167m with a combination of premium growth and lower levels of claims incurred.
GWPI reached £1,648m showing a 5.1% increase over the previous year.
In 2019, provide a total of £258m in Mutual Bonus to our members
Expect to provide £250m in Mutual Bonus from
New business written during the year, this totaled £105.8m, representing an 8.3% increase with strong performance across all lines of business.
Prudent management of costs, sound and fair claims handling, accurate pricing and risk selection resulted in a Combined Operating Ratio (COR) of 88.9%.
Group funds under management increased to £20.8bn reflecting the upturn in investment markets
The General Business fund achieved a return of 10.7% and the three-year annualized return was a healthy 5.1%.
https://www.nfumutual.co.uk/news-and-stories/agm-results-2020/
The parent company of the
https://www.thephoenixgroup.com/
https://www.thephoenixgroup.com/our-companies.aspx
ABOUT US
In addition,
Standard Life Assurance is a long-established expert in workplace pensions, personal pensions, long term savings and retirement solutions, and its customers and clients include individual savers and some of the largest employers in the
https://www.thephoenixgroup.com/about-us.aspx
OUR STRATEGY
MANAGE CAPITAL
Risk management is a key component of the Group's strategic agenda. The effective management of our risks and the efficient allocation of capital against them is critical in allowing us to achieve our strategic and operational objectives.
This includes ensuring there are robust capital policies within the life companies. We are well positioned to adapt to new requirements arising from Solvency II regulatory changes. Simplifying our capital structure brings greater flexibility and is a fundamental enabler of the strategic growth ambitions of the Group.
DRIVE VALUE
At
We seek to improve the efficiency of operational management through the standardization and streamlining of key processes across the Group which will in turn reduce costs, improve performance and maximize value.
IMPROVE CUSTOMER OUTCOMES
We have three key areas of focus in relation to our customers:
Value - we aim to manage customer outcomes to their maximum benefit
Service - customers want to be treated fairly, with empathy and respect in a timely fashion
Security - customers expect their investment to be secure in a well-managed company
ENGAGE PEOPLE
Building its reputation as an employer of choice, the Group specifically targets, recruits and develops top quality people. The Group invests in its people whose talent, enthusiasm and support makes its strategy and objectives achievable.
https://www.thephoenixgroup.com/about-us/our-strategy.aspx
2022 Full Year Results
Commenting on the results,
"
This has enabled us to deliver a strong set of financial results, with cash generation of £1.5 billion and our resilient balance sheet maintained. We have also grown our business both organically, with record new business growth of £1.2 billion, and inorganically, with the cash funded acquisition of
At
2022 Financial Highlights
Growing our dependable cash
£1,504m of cash generation1 in 2022 (FY21: £1,717m), which exceeds our £1.3bn-to-£1.4bn target range for the year.
£12.1bn of Group in-force long-term free cash has increased by c.£0.3bn (FY21: £11.8bn) as our business grew year-on-year. This cash, which will be released over time, ensures our growing dividend is sustainable over the very long term.
Maintaining a resilient Solvency balance sheet
£4.4bn2 Solvency II Surplus at
189% Solvency II Shareholder Capital Coverage Ratio2,3 ('SCCR') (FY21: 180%3) is currently above our target range of 140-180%, providing significant capacity to invest into growth.
Delivering record organic growth
£1,233m of incremental new business long-term cash generation (FY21: £1,184m) comprises £934m from our Retirement Solutions business (FY21: £950m) and £299m from our capital-light fee-based businesses (FY21: £234m).
£4.8bn of BPA premiums (FY21: £5.6bn) which generated a broadly stable level of incremental new business long-term cash generation, but with 20% less capital invested; capital strain reduced further to 5.8%4 (FY21: 6.5%).
£2.4bn of Workplace net fund flows (FY21: £0.2bn) and 53% increase in incremental new business long-term cash generation to £212m (FY21: £139m), as we retain our existing clients and benefit from new joiners to existing schemes and increased member contributions.
Strong dividend growth in 2022
The Group's dividend policy is to 'pay a dividend that is sustainable and grows over time'.
5% increase in the Final 2022 dividend to
2.5% organic dividend increase reflecting the Group's strong strategic and financial performance in 2022; and
2.5% inorganic dividend increase that reflects the value from the
Other key financial metrics
Assets under administration of £259bn (FY21: £310bn) are lower primarily due to c.£46bn reduction in asset values.
IFRS adjusted operating profit of £1,245m (FY21: £1,230m); IFRS loss after tax of £(1,762)m reflects significant adverse investment variances due to the accounting volatility from our hedging approach and an accounting mismatch from our own pension schemes that have been subject to a buy-in (with an offset in Other Comprehensive Income).
30% Fitch leverage ratio5 (FY21: 28%) remains within our target range of 25-30%, despite the impact of IFRS volatility.
Clear progress made against our strategic priorities and our key ESG themes
Optimising our in-force business
£739m of Solvency II management actions delivered in 2022, primarily through BAU actions that included ongoing balance sheet efficiencies, further illiquid asset origination and optimisation of our liquid credit portfolio.
Our comprehensive risk management approach protected both our capital position and long-term cash, and we comfortably met all collateral calls on our hedging instruments during the economic turmoil in the second half of 2022.
£3.5bn of illiquid assets originated (FY21: £3.0bn), comprising £1.9bn of illiquid private debt and £1.6 billion of Equity Release Mortgages, demonstrating our enhanced asset management capabilities.
Growing organically and through M&A
Delivered sustainable organic growth through our Standard Life branded Retirement Solutions and Pensions and Savings businesses, reflecting the investment into our propositions.
Won 76 new Workplace schemes with an aggregate asset value of c.£2bn that will transfer over the next 12-24 months.
Announced our first ever cash funded acquisition of
Enhancing our operating model and culture
Successfully migrated all c.400k annuities from Standard Life to the TCS BaNCS platform, and transferred c.1,200 customer service and IT colleagues to TCS Diligenta in line with our integration plan.
Completed the integration of the ReAssure Group Functions and announced in February the transfer of all c.3m policies from the Alpha platform to TCS BaNCS, delivering a further £180m of net cost synergies.
Improved diversity across the organisation, including gender balance achieved on our
Ongoing support for colleagues with the cost of living challenges, including a £1,000 net payment to our colleagues7.
Our strategic priorities are informed by, and in support of, our key ESG themes of: Planet and People
Planet - by transitioning our business to net zero, we aim to deliver better outcomes for our customers and play our part in tackling the climate emergency. Key achievements include:
c.£15bn of assets and c.1.5m members transitioned to Standard Life's Sustainable Multi-Asset default fund as we begin to decarbonise our investment portfolios at scale.
c.£340m of policyholder assets to be invested into an innovative multi-asset 'climate solutions' mandate as we maximise the opportunity of investing in climate solutions.
82% of key suppliers committed to setting science-based targets or Race to Zero based.
c.80% reduction in the carbon emission intensity of our own operations since 2019.
People - we want to help people live better longer lives. This means tackling the pension savings gap and supporting people to have better financial futures through promoting financial wellness and the role of good work and skills. Key achievements include:
Our think tank, Phoenix Insights, published several insightful research reports raising awareness of under saving, advocating for reform of the state pension, and contributing to the debate on economic inactivity.
c.1.2m customers offered the chance to review our digital literacy materials.
Improved average colleague engagement eNPS score of +30 (FY21: +23).
Key financial targets and guidance
Cash: 2023 cash generation target range of £1.3bn-£1.4bn; 3-year 2023-25 cash generation target of £4.1bn, which now includes future new business reflecting our confidence in delivering sustainable organic growth.
Resilience: continue to operate within our target ranges for our SCCR (140-180%) and Fitch leverage ratio (25-30%).
Organic growth: deliver further organic growth in 2023 as we progress towards our 2025 targets of c.£1.5bn of incremental new business long-term cash generation and c.£5bn of net fund flows in Workplace and c.£2bn in Retail.
M&A growth: complete the acquisition of
https://www.thephoenixgroup.com/newsroom/news/2022-full-year-results
The parent company of the global
https://www.prudentialplc.com/investors/governance-and-policies/companies-names-and-registration
Affiliates include:
Jackson
https://www.jackson.com/
(an indirect subsidiary)
https://www.eastspring.com/about-us/company-overview
https://www.prudentialcorporation-asia.com/prudential-pca/en/
ABOUT US
https://www.prudentialplc.com/~/media/Files/P/Prudential-V3/hkex/2020/2020-08-11a.pdf
GROUP AT A GLANCE
Focused on structural growth markets. Serving 20 million customers worldwide.
Our purpose
Our purpose is to help people de-risk their lives and deal with their biggest financial concerns. We provide our customers with the freedom to face the future with confidence .
Our strategy
Our strategy is to capture the long-term structural opportunities for our markets and geographies, while operating with discipline and seeking to enhance our capabilities through innovation to deliver high-quality resilient outcomes for our customers.
We aim to do this by:
Serving the protection and investment needs of the growing middle class in
Offering products to new customers in
Providing asset accumulation and retirement income products to US retirees.
Structural growth over the last 20 years has allowed our business to reach the scale where it can support its long-term goals through execution of its strategy and disciplined capital allocation.
Establishing a network with market-leading initiatives
Building a presence in one of the world's most under-penetrated markets
Operating in eight markets with a total population of almost 400 million
Pan-regional multi-channel network
Health, protection, saving and asset management in 15 markets
Top three position in nine life markets
Low insurance and mutual fund penetration
US retirement
Strength and flexibility of our distribution network gives us a distinctive advantage
Leading position in the retirement income industry
10,000 Americans reach retirement age each day for the next 20 years
Largest wholesaling force in the annuity industry
https://www.prudentialplc.com/investors/annual-report
A RESILIENT PERFORMANCE IN 2022, WELL POSITIONED FOR OPPORTUNITIES IN 2023 AND BEYOND
Performance highlights for the continuing business on a constant (and actual) exchange rate basis
APE sales2 up 9 per cent (5 per cent) to
New business profit3 down (11) per
Adjusted operating profit4 up 8 per cent (4 per cent) to
EEV operating profit5 up 15 per cent (12 per cent) to
GWS shareholder capital surplus over GPCR of
Operating free surplus generated8 from life and asset management business up 9 per cent (6 per cent) to
Second interim dividend of
"2022 was the first full year for the Group as an
"The removal of the bulk of Covid-19-related restrictions across the region and the progressive opening up of the Chinese Mainland economy has meant that 2023 has started well with encouraging progress in year-on-year sales, with Group-wide APE sales for the two months ended
"I'm honoured to have joined Prudential at such an exciting time with a tremendous opportunity for long term growth ahead of us. As we celebrate our 175th anniversary and 100 years of operations in
Chief Executive Officer
Summary financials
Full year
2022 $m
Full year
2021 $m
Change on
AER basis1
Change on
CER basis1
New business profit3
2,184
2,526
(14) %
(11) %
Operating free surplus generated8
2,193
2,071
6%
9%
Adjusted operating profit4
3,375
3,233
4%
8%
IFRS profit after tax10
1,007
2,214
(55) %
(53) %
Total
Per share
Total
Per share
EEV shareholders' equity
1,534¢
1,725¢
IFRS shareholders' equity
617¢
622¢
IFRS 17 Update
Effective
In summary, we expect an increase in the opening shareholder equity on
Looking ahead, the Group estimates a decrease in the adjusted IFRS 17 operating profit for 2022 of between
For the full financial report, see:
The parent company of the global
The Group has offices and subsidiaries around the world.
https://www.rsagroup.com/rsa-around-the-world/
ABOUT US
With over 300 years' experience, we have learnt a thing or two about risk and uncertainty and the value of insurance to our customer. As the world evolves so do the needs of those we serve, and we must respond with an agile yet resilient business that always strives to do better
We are one of the world's longest standing general insurers, providing peace of mind to individuals and protecting small businesses and large corporations from uncertainty. We use our capabilities to anticipate and exceed customer expectations and improve outcomes for customers via our direct channel, our broker relationships or partner organizations.
We have established leadership positions in Scandinavia,
https://www.rsagroup.com/who-we-are/
OUR STRATEGY
Our strategy is to concentrate on the regional insurance markets where we are strongest and sustain a platform of financial strength that enables our ambition. We do this though a focus on improving operational delivery and investments in our people and capabilities.
PRODUCTS THAT PROTECT OUR CUSTOMERS
Our business is built around our customers. We constantly challenge ourselves to serve them better and address their evolving needs.
EFFICIENT MULTI-CHANNEL DISTRIBUTION
Efficient access to our chosen customers is key to continuing to develop our business. We distribute our products in two ways: directly to customers, and through brokers and affinity partnerships.
UNDERSTANDING RISK AND PRICING APPROPRIATELY
To make sure that our prices and terms are accurate, competitive and sustainable, we are always working better to understand the risks our customers face.
PROACTIVELY MANAGING CLAIMS
We are committed to settling claims quickly and smoothly. We carefully manage our indemnity spend to keep the cost of claims efficient.
To serve customers well, we need to be resilient ourselves. This means having a strong capital base and being well reserved. Those funds are prudently invested in low-risk assets, and reserves are available to pay claims when the worst happens.
https://www.rsagroup.com/who-we-are/vision-and-strategy/
RSA reports excellent first quarter 2021 operating results
"RSA's run of record performance continued in Q1 as the Group delivered a combined ratio of 86%, our best such quarterly result of the last decade. We also announced today that the bid from Intact and Tryg should complete at the end of May, having now received its required regulatory approvals. The RSA business we handover has never been in better shape. I would like to thank our customers for their enduring support and my colleagues for their continued professionalism and commitment."
Trading update
Market conditions
Insurance market conditions were largely unchanged in Q1.
Premiums
Group gross written premiums of £2,045m were up 2% vs. Q1 2020
Profitability
Group business operating profit for Q1 nearly doubled versus Q1 2020, with a significantly improved combined ratio and lower investment income (as expected). Each of our three regions performed ahead of prior year.
Underwriting profit components:
Group weather costs were 1.7% of net earned premiums (Q1 2020: 3.7%).
The large loss ratio was 9.8% (Q1 2020: 9.4%; Q1 2020 ex. exits: 8.8%).
The attritional loss ratio improved overall, and in each region including and excluding covid impacts.
Prior year development was more favourable than Q1 last year
Balance sheet and capital
Tangible shareholders' equity at
The Group's estimated Solvency II coverage ratio was 200%3 at
https://www.rsagroup.com/media/tjbgcber/rsa-q1-2021-trading-update_6-may.pdf
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