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Catch up with the latest press releases from LV=

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LV= announces annual results for 2010

Press release: 31/03/2011

Mutual insurance, retirement and investment group LV= today announces its 2010 annual results.

2010 financial highlights

  • Net-earned premiums up 43% to £1.65bn (2009: £1.15bn)

  • Group underlying profit up 118% to £96.2m (2009: £44.2m)

  • Assets under management up 13% to £8.0bn (2009: £7.1bn)

  • With-profits fund investment return of 15.4%, 2.9% above benchmark

  • Capital resources up 2% to £966m (2009: £945m)

  • IFRS loss before tax of £18.3m (2009: loss of £91.4m) mainly as a result of a decision to reserve an additional £165m for future bonus payments

  • Result after tax of £21.3m (2009: loss of £172.2m)

Mike Rogers, LV= Group Chief Executive, said : "LV= performed very well in 2010 despite ongoing turbulent market conditions. Sales were extremely strong driving a doubling of underlying group profit and we are now performing competitively in our chosen product areas. We have also received widespread industry recognition for high customer service levels and product quality from organisations including Consumer Intelligence, Moneywise, Which Money and Defaqto."

"Our excellent with-profits performance means that our members continue to enjoy market-leading returns on their investments and we have now consistently achieved a top quartile performance for the last five years."


Life and pensions business

  • Trading profit of £34.7m, a 57% increase (2009: £22.1m) driven by sales of £124m on an APE basis (2009: £92.2m), a 34% increase

  • Retirement business saw a 35% growth in sales with APE [2] of £94.6m (2009: £70.0m)

  • Protection and savings businesses up 32% with APE of £29.4m (2009: £22.2m)

  • A £50 a month 25 year savings endowment policy maturing on 1 March 2011 paid out £47,096, an annual yield of 8.2%. This is significantly higher than the equivalent payouts announced by other major providers this year [3].

Commenting on the life business results, Mike Rogers said: "Sales are up across the board on pensions, annuities, protection and equity release in 2010 and we have seen a 57% increase in the division's profit. Our new protected retirement plan (PRP) product launch in February 2010 was a big driver behind our annuities success with significant sales of £8.4m APE in its first year."


General insurance business

  • Strong growth in premiums (46%) to £1.18bn (2009: £811.1m)

  • Trading profit more than quadrupled to £30.7m (2009: £7m)

  • Extreme weather events in 2010 cost an additional £30m (2009: £10m)

  • Profit before tax rose significantly to £34.7m (2009: £2m)

  • Total in-force policies grew to 3,369k (2009: 2,674k)

  • Combined ratio 104.2% (2009: 104.3%)

  • LV= now UK’s fourth largest car insurer

Commenting on the general insurance business results, Mike Rogers said: "The general insurance business continued its impressive track record of combining strong growth in customer numbers with increased profitability. In fact in the last 12 months general insurance profits have more than quadrupled. These results are particularly strong considering that 2010 was such a challenging year for the general insurance industry with extreme weather at both the start and end of the year with the result that many of our competitors announced losses as a result."


Asset management

  • Funds under management increased by 13% during 2010

  • Above benchmark returns deliver an additional £90m to with-profits members in investment returns

  • LVAM won the Lipper Best Small Bond Group award in March 2011, which recognised the performance of the fixed interest range of funds over the three years to the end of 2010

  • All investment teams now have external recognition by independent rating companies


Outlook for 2011

Commenting on LV='s expected performance in 2011, Mike Rogers said: "Our momentum from 2010 has continued into the first quarter of 2011 in respect of both sales and profits. As a result we continue to perform well and add to member value. Because of our strong growth we are planning to recruit a further 500 staff across our offices nationwide, at a time when many other companies are shrinking their workforce."


About LV=

LV= is a registered trademark of Liverpool Victoria Friendly Society Limited (LVFS) and a trading style of the Liverpool Victoria group of companies.

LV= employs around 4,500 people, serves over four million customers and members, and manages around £8.0bn (as at 31 December 2010) on their behalf, via LV= Asset Management (LVAM). We are also the UK’s largest friendly society and a leading mutual financial services provider. www.LVAM.co.uk.

LVFS is authorised and regulated by the Financial Services Authority, register number 110035. LVFS is a member of the ABI, the AFM and ILAG. Registered address: County Gates, Bournemouth BH1 2NF. www.LV.com.

Notes

[1] See table one
[2] Annual premium equivalent
[3] See table one

Provider

25 year conventional with-profits payout (£50pm, male, 30 next birthday)

LV= members better off by

LV=

£47,096

Friends Life (ex AXA)*

£36,316

£10,780 (30%)

Royal London

£34,304

£12,792 (37%)

Friends Life (ex Friends Provident)

£31,374

£15,722 (50%)

Scottish Life

£29,313

£17,783 (61%)

* Sun Life Assurance Society Conventional With-Profits fund

Source: Bonus declarations Q1 2011