About Us > Financial Strength > Financial strength
Financial strength
If you've seen the press in recent years about the failure of some high-profile financial services companies, you may be concerned about the financial strength of the pensions company you select.
Understandably you want to make sure you are dealing with a company that will remain safe and secure. You need to choose a provider who will be around for many years to come. As part of the Royal London Group, we're pleased to reassure you that our financial strength is continuing to grow ever stronger, despite the tough market conditions.
But don't just take our word for it, we've been given the following ratings by key independent agencies:
You can also read the AKG 2009 Company Profile & Financial Strength Report (PDF) on Scottish Life and Royal London.
| Company | Rating | Description |
|---|---|---|
| Standard & Poor's* | A- (July 2010) | Strong management and capitalisation with positive outlook |
| Moody's | A2 (April 2009) | Strong capitalisation with stable outlook |
| AKG Actuaries and Consultants Ltd | B+ | Very strong |
*Counterparty Credit Rating (CCR)
Explanatory notes
Standard & Poor's
Standard & Poor's is a global ratings agency which provides two types of rating: a Counterparty Credit Rating (CCR) and a Financial Strength Rating (FSR). A CCR is an opinion of a company's overall financial capacity (its creditworthiness) to pay its general financial obligations. An FSR is an opinion of the financial security characteristics of an insurance company with respect to its ability to pay claims on its insurance policies and contracts in accordance with their terms.
Broadly speaking, these ratings are the same, but a CCR relates to the general financial obligations of any company whereas FSR relates specifically to the security of life and pension plans (and any other insurance contracts) an insurance company has written.
Royal London has a rating of A- on a Counterparty Credit Rating basis.
Royal London has not approached Standard & Poor's to provide an FSR as our CCR rating should provide an appropriate explanation of our strength.
Moody's
Moody's investors service is a leading global credit rating, research and risk analysis firm. This agency rates providers on its opinion of their ability to repay policyholder claims and obligations on time.
AKG Actuaries and Consultants
AKG looks at various aspects before giving a financial strength rating, including:
- Capital base and free asset position
- With profits realistic balance sheet position
- The amount of with profits business in force
- Parental strength (and likely attitude towards supporting the company)
- Company and non-profit fund size
- Image and strategy.
Royal London - our future intensions
As the UK's largest mutual life assurance company, we are sometimes asked about our future intentions, and the possibility of demutualisation. We are confident our mutual status has served our customers well in the past and continues to do so. We believe our corporate structure is less important than being a financially sound and well-managed organisation providing pensions expertise to our customers.
