Life and pensions provider Royal London – a significant employer in Edinburgh – has reported record operating profits despite a turbulent environment.
The business said pre-tax operating profit hit an all-time high of £396 million, up from £329m in 2017. However, overall pre-tax profit was down to £351m from £594m.
Chief executive Phil Loney, who is to step down from his role by the end of this year, told The Scotsman that 2018 did not provide the easiest backdrop. “We saw stock markets drop, quite a bit of volatility – and a lot of investor uncertainty,” adding that auto-enrolment finished. But Royal London, which absorbed Scottish Provident and Scottish Life, saw life and pensions new business sales remain “strong” at £11.3 billion, from £12bn, “despite the fact that the market had effectively shrunk”.
Its asset management business delivered record net external inflows of £4.1bn, up from £2.8bn, with funds under management flat at £114bn.
Loney said it has been “a really strong new business year, albeit in a market where there are clear signs that retail investors, ordinary people saving into pensions, ISAs etc, are getting rather more wary about putting money away for the future, and that really started to become evident in the fourth quarter”.
The business also said it was the first to the UK market with an insurance product specifically for people with diabetes. “We think there is a number of managed regimes, including some cancers, that could also benefit from [a similar] approach.”