LV= has announced that pre-tax profit was £37m in 2020, up from £15m the year before, as the group saw its market share increase for the first time since 2016.
The result took into account a non-operating spend of £96m which was offset by favourable short-term investment fluctuations of £93m.
Its operating profit rose to £40m, up from a £16m loss in 2019, benefiting from an investment income of £15m and favourable reserving changes of £16m.
Tough trading conditions adversely impacted both its Savings and Retirement and Protection businesses, however, resulting in lower volumes and margins. In Savings and Retirement new business sales were £1.04bn, down from £1.14bn the prior year, while in Protection new business sales were £252m, down from £263m.
Savings and Retirement generated £8m of trading profit against £25m in 2019, and Protection generated £2m of trading profit, down from £15m the prior year. Both businesses saw an increased market share in the period, however.
Mark Hartigan, LV= CEO, said: “Despite the unprecedented challenges presented by the pandemic, LV= has delivered a good financial performance in 2020. Through the year we have created significant momentum in our trading businesses and I am particularly pleased that we increased market share in both Savings & Retirement and Protection.
“By taking quick and positive actions in response to Covid-19, as well as delivery of planned change initiatives, we continue to improve service for customers and have strengthened the propositions we offer the market.”
He added: “During 2020 we completed a significant change agenda and delivered a number of initiatives that helped improve our trading performance. We increased our market share in both the Protection and Savings & Retirement businesses for the first time since 2016.
“Success in 2021 will be determined by three simple objectives; to deliver the transaction with Bain Capital Credit, to hit our trading targets and to continue to reduce the complexity of our business and improve efficiency. With the backing of Bain Capital Credit, the board is excited by the opportunities for LV= to develop as a major force in the UK life insurance market for the benefit of our customers, people and partners.”