LV= £7m profit 'ahead of plan'

LV= turned around a £30m loss in 2008 into a £7m profit last year, pulling into the black one year ahead of its business plan.

Gross written premiums increased from £445m in 2008 to £811m last year. Highway, acquired at the end of 2008, increased premium income by over 21% to £287m.

LV= group financial highlights for 2009:

• Underlying profit rose by £41.9m to £44.2m (2008: £2.3m).

• With-profits fund investment return of 15.4%, 2% above benchmark.

• Gross written premiums in general insurance up to £524.3m.

• General insurance business made a profit of £7.0m (2008: loss of £30.1m), going into profit one year ahead of plan.

• APE in the life & pensions business was up 8% to £92.2m (2008: £86m).

• Single premium life & pensions new business was up 5.4% to £518.6m (2008: £492.2m) and regular premium was up 2.6% to £20.1m (2008: £19.6m).

• Capital resources of £0.9bn (2008 £1.1bn).

• Group IFRS loss before tax was £91.4m (2008: loss of £258.3m) reflecting short-term investment fluctuations, protecting the value of members’ with-profits policies, and reserve strengthening.

LV= group chief executive Mike Rogers said: “Despite another difficult year of continued recession and market turbulence, the turnaround of the LV= business continues according to plan. Our core mission of helping our members and customers to look after what they love has helped us to keep a sharp focus on the key priorities.

“A strong growth in underlying profit reflects our efforts in re-shaping the business and improving our organisational fitness. Improved awareness of the LV= brand, thanks to our distinctive marketing campaigns, has helped to support a strong sales performance across our life & pensions and general insurance businesses.

“Our strong investment performance underpins solid returns for our with-profits policyholders, ahead of most of the market, and we also remain strongly capitalised. In 2010 trading has begun strongly, with sales in the first quarter significantly up on the same period last year.”

For more, read this week’s Insurance Times, out Thursday.