Royal London said on Monday it made a pre-tax loss of £181 million in the first half of 2020 compared to a profit of £397 million in the same period last year “following falls in real asset values and a reduction in bond yields.”

Royal London is the UK’s largest mutual life, pensions and investment company which employs more than 1,000 in Scotland and includes the former Scottish Life and Scottish Provident businesses. 

First-half life and pensions new business sales fell 18% to £4.7 billion “reflecting difficult trading conditions experienced during lockdown in Q2 2020, as companies deferred decisions to move pension scheme providers and individuals delayed investment decisions.”

Net inflows fell to £997 million from £5.4 billion “as strong internal flows and growth in demand for sustainable funds were partially offset by external institutional outflows, particularly in the segregated fixed income and cash funds.”

Royal London said however that assets under management remained stable at the record £139 billion achieved at the end of 2019.

Operating profit before tax fell to £36 million from £90 million “reflecting reduced new business sales and increased digital investment.”

Royal London CEO Barry O’Dwyer said: “Our focus has been on supporting customers and advisers through the challenges associated with Covid-19.

“In particular, we have supported policyholders who have difficulty paying premiums due to their personal circumstances by encouraging them to contact us to arrange a practical way forward to maintain cover …

“Despite market volatility and economic uncertainty assets under management were stable at £139bn.

“Our capital position remains strong.

“New business sales for protection products grew by 15%, which was partly as a result of the pandemic reminding customers of the importance of life insurance, critical illness and income protection.

“Pension sales were lower as a consequence of the disruption to advisers’ ability to do business during lockdown …

“Covid-19 will inevitably continue to have an impact on new business prospects.

“Looking further ahead, our strong capital position and unrivalled reputation with advisers and customers will stand us in good stead as we continue to help customers meet their protection, investment and long-term savings needs.”

 Royal London CEO Kevin Parry said: “Royal London has successfully transitioned to 98% of our people working from home, enabling us to continue to provide our normal high level of service to customers.

“We remained open for business without needing to ask customers to delay interaction with us and we did this without taking any Government support …

“We have paid out claims to the families of more than 1,200 customers as a result of deaths attributable to Covid-19 …”