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Financial, Financial Services, Financial Solutions, Insurance, Insurance Services, Investment, Money

LV=, the investment, pensions and insurance group, has revealed that the credit crunch, stock market volatility, and fears of a recession are growing concerns for the nation’s pre-retirement population

Six months after the LV= ‘State of Retirement’ report* first identified the rise of ‘FREDs’ – people approaching retirement who are Facing Retirement Earnings Doubts – new research shows that 69% of pre-retired people are now more concerned than ever about their financial security. This equates to 7.1m people**, an increase of 600,000 since the first LV= ‘State of Retirement’ report was published in May 2008***.

The rising cost of utility bills and food prices remains the biggest worry for people facing retirement, with 71% of those surveyed. However, this is marginally down on six months ago (76%), whereas worries regarding the credit crunch, stock market volatility, and fears of a recession are now all on the increase.

The credit crunch has become a concern in the last six months for an additional 2.1m pre-retired people, making a total of 4.2m. In addition, a further 1.8m people have become more anxious about a recession and a further 1.5m about stock market volatility, totalling 4.5m and 3.1m pre-retirees respectively. Over 50s are also more concerned about job insecurity. These three issues have increased in importance over the last six months, further contributing to the growing number of FREDs.

Despite the increase in those admitting to being more concerned about their financial situation in retirement, 20% are not saving anything towards their retirement, while 51% have not increased the amount they are saving. Of the 10% who have increased the amount they save each month, the average is £225 a month, £35 more than the average monthly amount from the survey six months ago.

Mike Rogers, LV= group chief executive, said: “In just six months the number of FREDs has increased, indicating that pre-retired people across the UK are more concerned than ever about their retirement finances. Unsurprisingly, the credit crunch, stock market volatility, and fears of a recession are now huge issues for these people, along with the perennial concern about the rising cost of living.”

The latest LV= report also shows that the number of people approaching retirement who haven’t taken any form of financial advice about retirement planning has increased to 60%, compared with 56% previously.

Mike Rogers continued: “The FREDs of this world have at least received some small comfort from the recent Pre-Budget Report, with the announcement of increases in both the state pension and pension credit. This goes some way towards bridging the gap between income expectation and reality in retirement, that our survey revealed is an issue for many people.”

All figures, unless otherwise stated, are from online Opinium Research

* Sample size was 1042 adults over the age of 50 years. Fieldwork undertaken 14th – 19th April 2008. ** The over 50s population in the UK is 21,011,000 (Source: Population projections by ONS, 2008). According to the research, 49% of those people are not retired. The research also shows that 69% (7.1m people) agreed they have become more concerned lately about retirement finances. *** Sample size – 1655 adults over the age of 50 years. Fieldwork undertaken 3rd – 9th April 2008.

About LV= LV= is a registered trade mark of Liverpool Victoria Friendly Society Limited (LVFS) and a trading style of the Liverpool Victoria group of companies. LV= employs more than 3,500 people, serves more than 2.5 million customers and members, and manages around £8 billion on their behalf. LV= is also the UK’s largest friendly society (Association of Friendly Societies Key Statistics 2008. Total net assets) and a leading mutual financial services provider. LVFS is authorised and regulated by the Financial Services Authority register number 110035. LVFS is a member of the ABI, AMI, AFS and ILAG. Registered address: County Gates, Bournemouth BH1 2NF.

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Business, Financial, Financial Services, Financial Solutions, Insurance, Investment, Personal Finance, Retirement

Highway Insurance Group Acquired by LV

LV=, the UK based insurance, investment and pensions group, has announced its acquisition of the Highway Insurance Group, which includes Highway Insurance and Hero Insurance Services, further expanding the fast growing general insurance division of LV=.

The initial offer of 73.35p per share, which was recommended by the Highway Board, was made in August. Highway shareholders also received their interim dividend of 1.65p, payable at the start of October 2008. This gives an overall value of the entire issued share capital of Highway of £150m.

Fenchurch Advisory Partners acted as exclusive financial adviser to LV while Shore Capital Stockbrokers acted as corporate broker to LV=.

Mike Rogers, Group Chief Executive of LV= said: “We are pleased to have completed this deal quickly and we look forward to welcoming Highway into the LV= Group. This acquisition makes sound strategic sense and will assist us in our stated ambition to become a top five insurer in our chosen markets by 2012.”

He continued, “Highway is highly complementary to our existing general insurance operations and will provide a strong platform for growth. Putting the strengths of LV= and Highway together will enable us to compete even more effectively in the insurance broker market.”

Highway Insurance will become part of the LV= General Insurance business which is led by Managing Director John O’Roarke, who formerly headed up the Churchill and RBS Insurance businesses.

Andrew Gibson, Chief Executive of Highway, will be staying on in an advisory capacity until the end of the year, when he will be leaving to explore opportunities outside the LV= Group.

As LV= is a mutual organisation, owned by its members, Highway Insurance will be de-listed from the London Stock Exchange in due course.

About LV=:

LV= is a trademark of Liverpool Victoria Friendly Society Limited (LVFS) and LV= is a trading style of the Liverpool Victoria group of companies. LV= employs over 2,700 people, serves more than 2.5 million customers and members, and manages more than £7.7 billion on their behalf. LV= is the UK’s largest friendly society and a leading mutual financial services provider, providing home insurance and car insurance well as travel and pet insurance direct to consumers. It also offers insurance products exclusively to brokers via the Highway and ABC Insurance brands.


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