Royal London said its new life and pensions business rose 45% to just more than £6 billion in the first half of 2017, and funds under management rose 6% to £106 billion.
Royal London, the UK’s largest mutual life, pensions and investment company, employs more than 1,000 in Scotland and includes the former Scottish Life and Scottish Provident businesses.
Operating profit before tax was up 34% to £185 million.
Individual pensions and drawdown new business sales were up 64% to £2.9 billion, and group pensions new business sales were up 32% to £2.5 billion.
Royal London Asset Management (RLAM) saw gross inflows of £5.1 billion.
Royal London CEO Phil Loney said: “Recent FCA data confirmed a significant rise in Income Drawdown business across the market since the introduction of ‘Pension Freedoms’ in 2015.
“The data revealed a particular surge in non-advised drawdown sales; we think this is concerning as the best outcome for customers when choosing an income drawdown strategy generally occurs when they take financial advice, as the decisions are complex and can form a significant part of an individual’s retirement income.
“We are pleased that the FCA is looking at this area more closely, and our view is that they should do more to encourage individuals to take impartial financial advice when contemplating Income Drawdown.
“We are also concerned that some providers may be ‘sleep-walking’ their existing non-advised pension customers into their own in-house drawdown offerings, repeating some of the poor practice seen in the historic annuity market.
“Royal London intends to develop a better value for money drawdown offering and tools for those clients who insist on the non-advised route, but such competition will only be a viable solution if the FCA takes action to open this part of the market up to competition.
“We also believe that the Pensions Dashboard has the potential to boost competition in the UK pensions market.
“It is an important project designed to help customers by allowing savers and their advisers to have a comprehensive view of their pension savings and entitlements in one place to determine their retirement income.
“The dashboard could also provide a useful starting point for those advisers and customers seeking to obtain better value for money by consolidating numerous small pension pots.
“There is currently no legislation to ensure that all pension providers make their data available to the dashboard, which may create gaps in the data available causing the project to fail.
“We believe it is imperative that the Government legislates to mandate participation in the Pensions Dashboard as a key step to underpin greater competitive rivalry in the UK pensions sector which will in turn drive better value for money for consumers.”
Loney added: “During the first half of 2017 Article 50 was triggered and the process commenced for the UK to leave the European Union (EU).
“We are in the process of domiciling a subsidiary in Ireland to enable our business in the Republic of Ireland to continue to trade and to mitigate any uncertainty.
“We expect to maintain strong capitalisation and profitability as the UK leaves the EU.”
