L&G protection boost hides flat group sales

Legal & General (L&G) reported strong sales in protection and savings investments in the third quarter, but slowing new business in individual annuities and insured savings meant group sales dipped 1%.

The group said worldwide sales of £1,338m in the nine months year-to-date (YTD) were marginally lower than £1,347 in the same period last year. However, it said it expects to generate close to £1bn in cash this year.

Strong individual protection volumes driven by diversification into non mortgage related business led to an 11% growth in APE to £98m (Q3 2010 YTD: £88m). Each quarter this year has delivered volumes above any quarter since 2008.

Savings investments new business APE increased by 14% to £555m (Q3 2010 YTD: £486m) of capital light products. L&G said this was driven by the strength of its bank and building society partnerships, in particular Nationwide Building Society.

The figures exclude an agreement by L&G to take on the liabilities of the T&N Retirement Benefits Scheme in return for £1.1bn of assets.

Legal & General Investment Management (LGIM) wrote £25.1bn of gross new business, including £4.7bn of gross inflows, from its Liability Driven Investments (LDI) product segment.

This represents 19% of total gross inflows with LDI funds under management increasing by 33% to £52bn, up from £39bn in the same period last year.

Tim Breedon, group CEO, said: "This was another successful quarter from Legal & General, demonstrating that even in difficult markets our product mix, diversified distribution and operational strength enables us to deliver strong sales, expand our distribution, and beat our cash targets."