Scottish Life reports record new business

Ewan Smith of Royal London. Picture: Sandy Young
Ewan Smith of Royal London. Picture: Sandy Young
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SCOTTISH Life, the pensions division of the Royal London Group, saw sales hit a record last year as financial advisers prepared clients for new rules affecting employee savings.

The Edinburgh-based division said sales in the three months to the end of December rose 48 per cent to £662 million.

As a result, the mutually-owned pension business grew new business sales for the year by 8 per cent to £2.4 billion. The last quarter made all the difference as sales had dipped 2 per cent in the first nine months of the year compared to the same period in 2011.

Ewan Smith, managing director of Scottish Life, said: “This is a strong set of results, with good growth achieved in both individual and group pension business, despite a difficult economic background.”

A spokesman for Scottish Life said the boost in sales was mainly due to higher group pension sales ahead of auto enrolment – a government scheme to make most employers and employees pay into a long-term savings programme.

Although the company has yet to benefit from direct sales of pensions due to the rule changes – many employers eligible for getting involved have a “staging date” this year – he said many IFAs were focusing on “easier pickings” among existing and new workplace pension scheme clients. A focus among IFAs on workplace pensions saw individual pension sales lag behind, albeit a 28 per cent increase in the last quarter was a “good result”, the spokesman said.

Smith added: “Based on the most recent available market share statistics, Scottish Life has continued to increase its share of both the individual and group personal pension markets.”

He added that 2013 “promises to be an interesting year” as auto enrolment and the retail distribution review, which affects the company’s sales of pensions to individuals, come into force.

“Scottish Life is well-placed to benefit from both opportunities,” he said.

Royal London Group will announce its 2012 financial results, including full new business results for the group, on 28 March.