Legal & General’s retail annuity sales have grown by an average of 17% per year between 2015 and 2022, with sales up by an impressive 48% in 2023. Current sales are £1.28bn, compared to £862m for the comparable calendar point in 2022.
Legal & General is one of the market leading retail annuity providers having invested significantly in its digital customer journey, in-house underwriting expertise and distribution capability in recent years, which have been fundamental to its success. Sales through its intermediated business have more than doubled, with annuities increasingly seen as a bedrock of holistic retirement planning.
The firm offers a broad market proposition, including fixed term annuities and lifetime care plan alongside its lifetime annuity, enabling it to meet the diverse needs of both customers and intermediaries.
The business’ overall lifetime annuity market share has more than tripled from 6.5% to 20.2% since the start of 2016 and its fixed-term annuities book saw sales increase by over 100% this year. The exceptionally high annuity volumes were written at strong margins enhancing Solvency II New Business Value Add (NBVA) and IFRS 17 Contractual Service Margin (CSM).
“The annuity market underwent a dramatic shift after the introduction of pension freedoms, falling by over 60%, leading many firms to exit or consolidate. Rising interest rates have sent demand soaring in 2023 and, with workplace defined contribution assets set to double over the next decade, we can expect to see this momentum continue as retirees seek to diversify their income sources” said Nigel Wilson, outgoing Chief Executive, Legal & General
“As the economic environment has changed in recent years, we have been ideally placed in Retail Annuities to capitalise on the opportunity, due to our continued investment in the business. Our strong sales reflect our responsive pricing, broad proposition and wide distribution reach: providing more customers with certainty and peace of mind in a volatile market.” said Lorna Shah, Managing Director, Retail Retirement, Legal & General.
