Legal and General blame slump on poor annuity sales

Legal & General

Legal & General

The fourth biggest insurer in the UK blamed poor performance for the previous quarter on lower than usual annuity sales, as they missed analysts expectations.

Despite missing the expectations, the group still posted a 12% increase, with revenue of £433million for the last three months, just short of the £442million expectation.

Marcus Barnard rom Oriel Securities Ltd said, “Overall a decent set of figures, showing cash generation ahead of target and growth in savings and international, albeit with some weakness in U.K. bulk annuities,” and advised customers to buy stocks in the firm.

The firm is looking to increase their revenues as the UKs increasingly ageing population start saving more for a retirement that get’s longer as health standards and technologies push life expectancy up.

The firm did see annuity sales, part of their risk division, drop by 14% to just £72million, although they noted that the comparison with last year was a difficult one due to the governments legal retirement age increase.

Legal and General saw cash generated increase by 18%, to £212million, which is ahead of the companies target of £700million for the whole year. Savings revenue was also up 20% to £320million.

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