Royal London has set a new record for protection claims paid in a single year while new business from its UK protection division grew 44%.
Results for the year ended 31 December 2021 showed new protection sales rose from £27m in 2020 to £39m last year, with the mutual seeing its overall UK protection sales increase to £1.25bn, up from £1.192bn in 2020.
The group paid out £596m in claims for approximately 80,000 customers and their families across all of its protection business in 2021, setting a new record exceeding the £591m paid out in protection claims in 2020.
Overall the group reported profit before tax of £192m, up from £131m in 2020, and an increase in assets under management to £164bn from £148bn in 2020.
The results statement failed to comment on Royal London’s unsuccessful attempt to merge with LV= following LV= shareholders’ rejection of Bain Capital’s own bid to buy the fellow mutual late last year.
Help customers put cover in place
Royal London attributed the increase in protection sales to continued momentum in helping customers put cover in place for themselves and their families.
During the period the insurer also removed Covid underwriting restrictions, retendered its mortality reinsurance arrangements and launched a campaign to help advisers respond to increased demand from customers for protection.
It also launched its Value of Menu tool, following this with adviser webinars, and an income protection for tenants and their familie’ campaign to highlight the risks that renters face if they become too ill to work, and how the right cover can help.
Its Underwrite Later option was launched for business protection products which enables cover to be put in place immediately while the remainder of the underwriting process completes, and which has subsequently been extended to more products.
In Ireland, protection new business increased to £17m from £12m in the previous year with overall protection sales growing to £185m from £137m.
Barry O’Dwyer, group chief executive at Royal London, (pictured) said the business’ purpose as a mutual has never been more relevant.
“We help families in the UK and Ireland to protect what they have today and invest in a better tomorrow. We are responsible stewards of our customers’ money. As a mutual, our customers get to share in our success,” he said.
O’Dwyer added that 2021 was a good year for Royal London.
“Sales and profits are both up on last year. We have maintained very strong flows into our asset management business, helping assets to hit record levels.”
Kevin Parry, chairman at Royal London, added: “We are committed to our mutual status and are strong advocates of the role mutuals play in financial services. This year we will share £169m with 1.8 million eligible customers.
“Since we introduced ProfitShare in 2007, Royal London has returned more than £1.2bn, which is only possible because we are a mutual.
“In the last 10 days, the conflict in Ukraine has significantly increased the human and socio-economic risks in Europe and the World. We are closely monitoring all developments and have made an emergency charitable donation of £250,000 to the British Red Cross Ukraine Crisis Appeal that is providing humanitarian relief in Ukraine.”