Customers, not shareholders, benefit as profits rise

Royal London financial results 2023
Published  08 March 2024
   5 min read

Barry O’Dwyer, Group Chief Executive, commented:

"Royal London is a customer-owned mutual, so we don’t have shareholders. This means that the 19% growth in our operating profit before tax is good news for our customers. The profits we make are reinvested in the business to improve our offerings and service for customers, returned to eligible customers via ProfitShare, and used to support our charitable and social impact activities.

"In 2023, we welcomed 930 new workplace pension schemes, allowing us to support a further 240,000 new pension savers. The breadth and depth of our investment range attracted over £4bn in net inflows, as we grew our membership base, and delivered strong active investment performance while expanding our fund range and international reach."

Kevin Parry OBE, Chairman, commented:

"2023 was another year of significant uncertainty, however our mutuality enables us to continue to focus on the long term and to put our members and customers firmly at the heart of our decision-making.

"We have again shared our success with eligible customers through ProfitShare. I am delighted that our ongoing performance and continued strength has enabled us to share £163m with over two million eligible customers."


  • ProfitShare3 of £163m (2022: £155m) to be shared in April 2024 with over two million eligible customers who have life and pensions policies with Royal London.
  • The Governed Range, our flagship offering, attracted net inflows of £3.0bn (2022: £3.4bn), with Assets under Management (AUM) reaching £60bn (2022: £53bn).
  • During 2023, we enhanced our Workplace digital transfer offering making it easier for customers to consolidate their pension pots with us and we also introduced a new state benefits calculator to our financial wellbeing health check enabling customers to identify their eligibility for benefits, entitlements and grants.
  • Continued focus on improving Protection products to ensure we keep delivering better outcomes for customers. We paid 99.0% (2022: 99.4%) of protection claims, paying over £725m to approximately 76,000 customers, making a real difference to families across the UK and Ireland who have had to face the worst kinds of life shocks.
  • Reached an agreement with Aegon UK to acquire its closed individual protection book of over 400,000 policies, and in January 2024 completed the acquisition of Responsible Group, which provides later life lending products.
  • Named Company of the Year 2023 at the Financial Adviser Service Awards – where we retained our five-star service rating for the 15th year running for pensions, and the 10th year running for protection.
  • Extended our annuity capabilities in advance of an intended participation in the bulk purchase annuities market, focused on providing a competitive solution to the trustees of defined benefit pension schemes.
  • Expanded our international asset management footprint, securing our first Japanese mandate and registering a number of funds in Scandinavia while totally modernising our infrastructure.
  • Investment performance of actively managed funds remains strong with 96% (2022: 80%) of actively managed funds outperforming their three-year benchmark4.
  • Became Founding Partner of first ever British & Irish Lions Women’s Programme and committed to investing in elite player and coach development, as well as women’s and girls’ grassroots rugby, across the UK and Ireland.
  • Announced a new £1.2m partnership with Cancer Research UK focused on tackling cancer inequalities.



Year ended
31 December 2023

Year ended
31 December 2022

UK GAAP Operating profit before tax5 £249m £210m
Transfer to/(from) the fund for future appropriations6 £382m £(162)m
ProfitShare3 £163m £155m
New business Life and pensions new business sales7 £9,253m £10,776m
Inflows Gross inflows8 £29,904m £26,647m
Net inflows8 £4,203m £3,718m
  31 December 2023 31 December 2022
Funds Assets under Management9 £162bn £147bn

(Solvency II)

Regulatory View solvency surplus £2.9bn £2.5bn
Regulatory View capital cover ratio 206% 206%
Investor View solvency surplus £2.9bn £2.5bn
Investor View capital cover ratio 218% 213%
  • Operating profit before tax5 increased by 19% to £249m (2022: £210m) driven by growth in new business contribution, active management of our cost base and the positive impact of higher risk-free rates.
  • Transfer to the fund for future appropriations (FFA)6 of £382m (2022: transfer from FFA (£162m)) reflects the improvement in operating profit and higher investment returns than our long-term expectations.
  • Life and pensions new business sales7 of £9,253m (2022: £10,776m) reduced in value as higher interest rates decreased the present value of new business premiums. Workplace Pensions new business sales grew 4% after adjusting for the increase in the discount rate whilst Individual Pensions sales fell as higher interest rates impacted defined benefit transfer volumes.
  • Net inflows8 increased to £4,203m (2022: £3,718m) due to higher external net inflows on short duration cash products partially offset by lower internal net inflows as more customers accessed their pensions.
  • Assets under Management9 increased to £162bn (31 December 2022: £147bn) due to net inflows and positive market movements, particularly in the second half of the year.
  • Capital position remains robust with the Investor View cover ratio10 increasing to 218% (31 December 2022: 213%) and Regulatory View cover ratio10 stable at 206% (31 December 2022: 206%).

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Notes to editor

  1. The information in this announcement relates to The Royal London Mutual Insurance Society Limited ('RLMIS' or 'the Company'), and its subsidiary undertakings, together referred to as 'Royal London' or 'the Group'.
  2. The Group assesses its financial performance based on a number of measures, some of which are not defined or specified in accordance with relevant financial reporting frameworks such as UK GAAP or Solvency II. These measures are known as alternative performance measures (APMs). APMs are disclosed to provide further information on the performance of the Group and should be viewed as complementary to, rather than a substitute for, the measures determined according to UK GAAP and Solvency II requirements. Accordingly, these APMs may not be comparable with similarly titled measures and disclosures by other companies.
  3. ProfitShare is a discretionary enhancement to eligible RLMIS customers with unit-linked or with-profits policies. The allocation is considered annually and depends on a number of factors including financial performance, capital position, the risks and volatility of financial markets and the Group’s outlook.
  4. Investment performance has been calculated using a weighted average of active assets under management for funds with a defined external benchmark. Benchmarks differ by fund and reflect their mix of assets to ensure direct comparison. Passive funds are excluded from this calculation as, whilst they have a place as part of a balanced portfolio, Royal London believes in the long-term value added by active management.
  5. Operating profit before tax represents profit/(loss) before transfer to/(from) the fund for future appropriations excluding: short-term investment return variances and economic assumption changes; goodwill (charge)/credit arising from mergers and acquisitions; ProfitShare; ValueShare; tax; and one-off items of an unusual nature that are not related to the underlying trading of the Group. Profits or losses arising within the closed funds are held within the respective closed fund surplus; therefore operating profit before tax represents the result of the Royal London Main Fund (RL Main Fund).
  6. Transfer to/(from) the fund for future appropriations represents the statutory UK GAAP measure 'Transfer to/(deduction from) the fund for future appropriations' in the technical account within the Consolidated statement of comprehensive income. 
  7. Life and pensions new business sales represent life and pensions business only and excludes Asset Management, other lines of business and the bulk annuity buy-in transacted with the Royal Liver UK pension scheme. New business sales are presented as the Present Value of New Business Premiums (PVNBP), which is the total of new single premium sales received in the period plus the discounted value, at the point of sale, of the regular premiums the Group expects to receive over the term of the new contracts sold in the period. The rate used to discount the cash flows in the reported results has been derived from the opening swap curve at the start of the financial period for all new business except annuities where the rate used is the future yield (less an allowance for downgrade and default risk) on assets expected to back these annuitant liabilities over the lifetime of the contracts.
  8. Gross and net inflows incorporate flows into Royal London Asset Management (RLAM) from external clients (external flows) and those generated from RLMIS (internal flows). External client net inflows represent external inflows less external outflows, including cash mandates. Internal net inflows from RLMIS represent the combined premiums and deposits received (net of reinsurance) less claims and redemptions paid (net of reinsurance). Given its nature, non-linked Protection business is not included.
  9. Assets under Management (AUM) represent the total of assets actively managed by the Group, including funds managed on behalf of third parties. 
  10. The capital cover ratio is calculated as the Group’s Own Funds, being the regulatory capital under Solvency II, divided by the Solvency Capital Requirement (SCR). The 'Investor View' equals the RL Main Fund capital position (excluding ring-fenced funds). The 'Regulatory View' solvency surplus and capital cover ratio exclude the closed funds' surplus as a restriction to Own Funds. All capital figures are stated on a Group Partial Internal Model basis and the 2023 figure is estimated and unaudited.
  11. Figures presented throughout are rounded. The capital cover ratios and new business margins are calculated based on exact figures.

About Royal London

Royal London is the largest mutual life, pensions and investment company in the UK, and in the top 25 mutuals globally, with assets under management of £162 billion, 8.6 million policies in force and over 4,200 employees. Figures quoted are as at 31 December 2023. Learn more at