Press release

LV= Announces 2019 Financial Results

Mutual life pensions and investments group LV= announces its financial results for the year to 31 December 2019 and publishes its annual report.

Strategic and operational highlights:

  • Completed the sale of LV= General Insurance to Allianz.
  • Converted from a friendly society to a company limited by guarantee in January 2020.
  • Significantly improved capital position.
  • Strengthened executive team with key appointments to lead our main lines of business.
  • Improved Adviser Net Promoter Scores.

Financial highlights:

  • Group Solvency II capital coverage ratio 244% (FY 2018: 172%).
  • Life new business PVNBP £1.3 billion (FY 2018: £ 1.8 billion).
  • Life operating capital generation £101 million (FY 2018: £182 million).
  • Life trading profit £43 million (FY 2018: £50 million).
  • Profit before tax from continuing operations £15 million (FY 2018: £90 million loss).
  • Transfer to Unallocated Divisible Surplus £127 million (FY 2018: £62 million transfer from UDS).

Mark Hartigan, LV= Chief Executive, said: “I am delighted to have been given the opportunity to lead LV=.  Our company has an outstanding heritage of service and delivery to members, customers and partners. Clearly we are living in unprecedented times, the coronavirus situation is both very serious and rapidly evolving.  Our priority remains to focus on the best outcomes possible for our members, customers and staff.

“Notwithstanding the challenging external environment, this is an exciting time to be joining having just converted from a friendly society to a company limited by guarantee and successfully completed the sale of our general insurance business.

“As a mutual we are run for the benefit of our members and are pleased therefore to be able to transfer £127 million to the Unallocated Divisible Surplus and allocate a mutual bonus of £27 million to qualifying members.  Our capital position is strong and our Capital Coverage Ratio has increased to a very healthy 244% which includes the impact of the sale of the general insurance business.  This takes our capital position above the top end of our risk appetite range of up to 200% and we are currently considering how best to utilise this surplus capital.  We continue to make progress in reducing our cost base with a further £3 million decrease in operating expenses primarily driven by a year–on-year reduction in staff numbers. Strong cost discipline will be increasingly important throughout 2020 as we make the transition from our old group structure to a pure life, pensions and investments business.

“Life trading profit of £43 million (FY2018: £50 million) includes new business contribution of £14 million (FY 2018: £19 million) which was suppressed by difficult trading conditions while profit generated from in-force business was stable at £29 million (FY 2018: £31 million).  Profit before tax from continuing operations of £15 million (FY 2018: £90 million loss) reflects adverse reserving changes of £67m (FY 2018: £10m favourable) and favourable short-term investment fluctuations of £129m (FY 2018: £66m adverse).

“During the year we strengthened our executive team by appointing Clive Bolton (previously Managing Director of Retirement Solutions at Aviva Life UK) and Debbie Kennedy (ex Group Head of Protection Strategy at Royal London) to lead the savings and retirement and protection businesses and they are bringing a greater focus to trading performance.

“In a crowded market I believe the strength of the LV= brand can be a differentiator.  We are proud to have been named the UK’s Most Trusted Life Insurance provider in the Moneywise Customer Service Awards for the seventh consecutive year. We also retained our title of Best Income Protection Provider at the Investment Life & Pensions Moneyfacts Awards for a tenth year.  Our Adviser Net Promoter Score puts us in first place compared with our competitors.”

Financial highlights:

    FY2019    FY 2018   Change (%) 
Life trading profit   £43 million   £50 million
New business contribution   £14 million
  £19 million
Life new business sales (PVNBP basis)   £1.33 billion
  £1.80 billion
     Savings and Retirement   £1.04 billion
  £1.50 billion
     Protection   £285 million
  £296 million
     Heritage   £3 million
  £4 million

Trading conditions remained tough in 2019 due to the continued decline in pensions to levels seen prior to the 2015 freedom and choice reforms and on-going investment market uncertainty.

Across savings and retirement total sales were £1.04 billion (FY 2018: £1.50 billion) with pensions and flexible guarantee funds particularly impacted by market conditions. During the year we successfully revised the strategic asset allocation with the aim of improving returns to policyholders. Our members benefited during 2019 from an increased investment return due to strong performing overseas equity markets. We saw strong volumes of Fixed-Term Annuities during 2019, up 31% on 2018 as we helped advisers support customers to secure income in retirement. Equity Release volumes were down 15% on 2018 as the market slowed as Brexit uncertainty weighed on consumer confidence.

In protection, our focus on improving profitability over volume has resulted in new business contribution increasing to £8 million (FY 2018: £1 million). Overall sales have reduced by 4% to £285 million (FY 2018: £296 million) with term life sales decreasing by 9% and critical illness sales by 19% as we focused on enhancing our income protection proposition and maximising profit. Sales of our flagship income protection products have increased by 19% as the marketplace responded positively to product enhancements made at the end of 2018 and the launch of our one year variant in June 2019.

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 14.5% (FY 2018: 4.2% negative returns), outperforming the benchmark of 13.9%.

Mark Hartigan concluded: “2019 was a pivotal year in the history of LV= and 2020 will be no less important.  The full effect of the COVID 19 crisis is still to be understood but we are in an exceptionally well-capitalised position and as we face the challenges ahead, we will continue to work hard for the benefit of our customers and members.  We will strive to do our best to safeguard their interests and come through this ready to focus on our long term sustainability and growth.”

For further information:

The full LV= results can be found on our reports and financial ratings page.

Notes to editors

These numbers are unaudited.


Certain statements in this press release may constitute "forward-looking statements". These statements reflect the Issuer's expectations and are subject to risks and uncertainties that may cause actual results to differ materially and may adversely affect the outcome and financial effects of the plans described herein. You are cautioned not to rely on such forward-looking statements. The Issuer disclaims any obligation to update their view of such risks and uncertainties or to publicly announce the result of any revisions to the forward-looking statements made herein, except where they would be required to do so under applicable law.

About LV=

LV= is a leading financial mutual and serves over 1.3 million members with a range of financial products. 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. 

LV= and Liverpool Victoria are registered trademarks of Liverpool Victoria Financial Services Limited and LV= and LV= Liverpool Victoria are trading styles of the Liverpool Victoria group of companies. Liverpool Victoria Financial Services Limited, registered in England with registration number 12383237 is authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and the Prudential Regulation Authority, register number 110035. Registered address: County Gates, Bournemouth, BH1 2NF.