LONDON - Legal & General Group Plc (LON:LGEN) has announced a significant turnaround in its financial performance, with its annual report for 2024 revealing robust growth in both protection premium income and overall market presence. The release, which followed preliminary results published on March 12, 2025, has highlighted a myriad of successes amid a challenging economic backdrop.
Legal & General's individual protection customer base now boasts an impressive 5.4 million lives, including 1.5 million customers in the USA. The company reported that its combined protection new business value under Solvency II calculations rose a notable 16%, hitting £192 million in 2024, up from £165 million the previous year.
In the UK retail sector, the gross premium income from individual protection showed a slight increase, reaching £1.53 billion in 2024, compared to £1.51 billion in 2023. The report indicated that annual new business premiums grew from £150 million to £153 million, demonstrating improved margins in what the company characterized as a “highly competitive market.” Furthermore, Legal & General claimed a year-on-year market share increase to 19%, as reported by the Association of British Insurers (ABI).
Legal & General's UK group protection also experienced a gratifying 10% rise in gross premium income, climbing to £528 million from £479 million. Despite this positive trend, new business annual premiums in this segment declined to £110 million from £121 million in 2023. The company credited sustained retention as a contributing factor to this success.
Legal & General has also shown commitment to technological advancement, with over 2,400 SME employers utilizing its Onix online quote and application system. This platform processed approximately 1,900 new applications in 2024, significantly up from 1,000 the previous year. Additionally, the company successfully supported 77% of employee group income protection claims back into the workplace, evidenced by 2,466 members returning to work in 2024.
Internationally, Legal & General's US protection business remains a focal point as it prepares for its acquisition by Japan-based insurer Meiji Yasuda, a transaction estimated at £1.8 billion ($2.3 billion) announced in February. Legal & General reported a 6% increase in gross premiums in its US arm, amounting to $1.69 billion compared to $1.58 billion the previous year. New business annual premiums also surged by 16%, totaling $203 million in 2024.
António Simões, CEO of Legal & General, commented on the results, stating, "Our US protection business is high performing and has grown rapidly in recent years. Strategically though, it offered limited synergies with the rest of our business, and the recent announcement in February 2025, to sell this business allows us to unlock substantial value for the group at attractive multiples, and to reallocate capital to areas of strategic growth." This strategic shift underscores Legal & General's focus on enhancing its core operations and moving toward more integrated business models.
The broader market reflected positively on Legal & General's financial metrics, as evidenced by the company’s impressive 55% rise in share values over five years despite stock market volatility. On March 12, 2025, it announced a £500 million share buyback program, surpassing the anticipated £450 million forecast. This is part of a three-year strategy aimed at returning more than £5 billion to shareholder investments.
Legal & General's operational success isn't limited to shares and premiums; the financial services firm also reported a 6% growth in its core operating profit, which reached £1.62 billion in 2024. This robust performance was accompanied by a 5% increase in the full-year payout to shareholders, now standing at 21.36 pence.
However, caution remains as earnings per share (EPS) showed a downward trend: EPS fell by 62% to 19.4 pence in 2022, decreased by 43% to 7.35 pence in 2023, and further plummeted by 61% to just 2.89 pence in 2024. Excitement over rising dividends may counterbalance concerns regarding these declines.
Investors and analysts speculate that market fluctuations and rising interest rates could impact the company's future performance. Nonetheless, 16 analysts project a median target price of 265.3 pence for the shares, suggesting a modest increase of around 6.75%—an expectation that could yield a total return of approximately 15% when combined with dividends.
In summary, Legal & General's comprehensive 2024 Annual Financial Report reflects a dynamic performance underscored by increased protection business and company-wide financial health. Despite challenges outlined in EPS figures, the firm continues to bolster shareholder confidence through substantial buybacks and a promising outlook for protection markets, emphasizing its commitment to moving forward in both the UK and international financial landscapes.
