“Risk performed well in a tough environment. We continue to diversify and innovate to improve product and service for our customers.”
John Pollock Group Executive Director (Risk)
Our Risk business assumes customers’ financial risks arising from defined events such as death, injury or household damage. This includes annuities, which mitigate the risk of the individual exhausting their savings in old age. Pricing and underwriting is based on rigorous statistical analysis of the probability of the defined event happening to the individual in question.
Risk products are distributed through four channels: Independent Financial Advisers, Bank and Building Society Partnerships, direct distribution and Legal & General’s Mortgage Club, (LGPSL).
Our Products
Risk; new business [APE]
(2007: £428m)Individual Protection
Covers individuals or families against financial losses arising from defined events such as death, disability or critical illness.
Group Risk
Products which are designed for use by employers to offer as a benefit to their employees. They assume the risks and associated costs of an employee falling ill or dying while in employment.
Annuities
Bought by people converting a lump sum (often money saved in a pension scheme) into a lifelong income.
Bulk Purchase Annuities (BPAs) or Pension Buyouts
BPAs are offered to companies wishing to transfer all or part of the responsibility and risk from company pension schemes to an insurance company for a negotiated price.
General Insurance (GI)
Focusing on the household sector, we insure the fabric of properties and their contents.
Mortgage Club
Our network of mortgage advisers provides a link with mortgage lenders, sourcing mortgages for clients and facilitating sales of Protection and GI products.
Our Strengths
Risk; [IFRS] operating (loss)/profit
(2007: £104m)- Risk pricing and underwriting expertise.
- Extensive database enables accurate statistical modelling.
- Particular expertise in medical underwriting and mortality/morbidity.
- Technological investment facilitates interactive underwriting and rapid data loading.
- Economies of scale and administrative excellence.
- Leading rapid intervention based Group Risk product enables corporate clients to secure faster returns to work for sick employees.
- Synergies with [LGIM] facilitate pricing and execution of pension buyout and bulk annuity business.
- Wide ranging distribution through Independent Financial Advisers (IFAs), sole-tie business partners and bank and building society partnerships.
- Mortgage Club drives Protection and [GI] by providing access to customers at point of sale.