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Catch up with the latest press releases from LV=

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LV= Q1 2014 trading statement

Press release: 28/04/2014

Mutual insurance, retirement and investment group LV= issues its trading statement for the three month period from 1 January to 31 March 2014.

General insurance sales

General insurance sales

3 months ended
31 March 2014

3 months ended
31 March 2013

12 months ended
31 December 2013

Gross Written Premium (GWP)

£363 million

£379 million

£1.45 billion

GWP by channel:

Direct

£212 m

£219 m

£824 m

Broker

£151 m

£160 m

£621 m

GWP by product:

Motor (private)

£254 m

£287 m

£1,054 m

Home

£45 m

£37 m

£155 m

Commercial inc. SME

£54 m

£45 m

£201 m

Other

£10 m

£10 m

£35 m

Motor in-force policies

3.1 m

3.1 m

3.1 m

Total in-force policies

4.5 m

4.2 m

4.4 m


Life insurance and Heritage sales

Life insurance and Heritage sales

3 months ended
31 March 2014

3 months ended
31 March 2013

12 months ended
31 December 2013

Life and Heritage overall (APE)

£39 m

£35 m

£159 m

Retirement

£28 m

£26 m

£119 m

Pensions

£14 m

£15 m

£64 m

Annuities

£11 m

£9 m

£46 m

Equity release

£3 m

£2 m

£9 m

Protection

£7 m

£7 m

£29 m

Savings & Investments*

£4 m

£2 m

£11 m

APE = annual premium equivalent

* Heritage which is our with-profits business which is predominantly savings and investments.


Mike Rogers, LV= Group CEO commented:

"In the first three months of the year our trading businesses have continued to perform well despite external events impacting both general insurance and life and pensions.

"In general insurance, we have seen good levels of growth in home and SME with sales up 22% and 20% respectively. This is in line with our strategy of diversifying our customer base away from motor and into other business lines now we have reached significant scale in motor. Across the product range we have taken on around 100,000 mainly non-motor customers in the first three months of the year bringing our total in force policy count to 4.5 million.

"We received around 7,000 claims as a result of the storms in the early months of the year mostly impacting our SME and home insurance lines. However the overall financial impact is not significantly out of line with what we would expect during a winter period and we are confident that given more normal weather conditions during the remainder of 2014 the property lines will deliver acceptable results.

"In motor, rates continue to be competitive and challenging, and this is reflected in the decrease in gross written premiums, with average premiums reducing and margins eroding. We expect motor rates to start to increase during the latter part of the year as we believe that certain segments of the market have over anticipated the reduction in claim value as a result of the LASPO legislation.

"Over the first quarter sales overall are up 11% in our life and pensions business. Following the changes to the retirement landscape announced in the budget, we took immediate action for the benefit of our customers. On the same day as the budget we announced an extension to our annuity quote guaranteed period from 30 days to 45 days, and for those customers within their 30 day cancellation period we extended our cooling off period to 60 days. Just ten working days after the budget we launched a new one year annuity for those customers who want to take advantage of the greater flexibility the new pension rules will offer, but need an income between now and April 2015.

"We expect to see lower levels of annuity sales over the coming months as consumers defer decisions until the new regime takes effect. We also believe that margins will be negatively impacted on the range of retirement solutions products in the future. LV= is a leading provider of income drawdown and offers a comprehensive range of retirement solutions products. We are well placed over the medium term to benefit from the new landscape as consumers increasingly shop around to find the right product for their personal circumstances.

"In protection, we updated our market-leading critical illness policy to include an increase in the number of conditions covered to 64 and enhancements to existing cover. We continue to be the number one income protection provider of choice for advisers and we improved our policies to pay benefits based on the simple definition of being unable to perform the customers own occupation.

"I am confident that despite changeable market conditions, with our approach of offering good value products and excellent customer service, we are well placed for future growth in our chosen business lines."


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For further information please contact:

Emma Banks, 0208 256 6714, 07894 158605, emma.banks@lv.com


Notes:

LV= employs over 5,800 people and serves over 5.5 million customers with a range of financial products. We are the UK’s largest friendly society and a leading financial mutual.

When we started in 1843 our goal was to give financial security to more than just a privileged few and for many decades we were most commonly associated with providing a method of saving to people of modest means. Today we follow a similar purpose, helping people to protect and provide for the things they love, although on a much larger scale and through a wide range of financial services including insurance, investment and retirement products.

We offer our services direct to consumers, as well as through IFAs and brokers, and through strategic partnerships with organisations such as ASDA, Nationwide Building Society and a range of trade unions.