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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.  We believe, as part of the Royal London Group, we have the financial strength to reassure you.

Our financial strength ratings are shown in the table below. Although ratings are important, each company measures different things and they are, by their very nature, a snapshot in time.

You can also read the AKG 2007 Company Profile & Financial Strength Report (PDF) on Scottish Life and Royal London.

Company	Rating	Definition of rating
AKG Actuaries and Consultants	B+	Very good financial strength
Moody's	A2	Good financial security
Standard & Poor's	A-	Describes us as having strong regulatory solvency
Fitch	A

AKG, September 2007; Moody's, September 2007; Standard & Poor's, April 2007; Fitch, October 2007.

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.

Fitch Ratings
Fitch Ratings is a leading global rating agency committed to providing the world's credit markets with independent, timely and prospective credit opinions. Built on a foundation of organic growth and strategic acquisitions, Fitch Ratings has grown rapidly during the past decade gaining market presence throughout the world and across all fixed income markets.

Royal London
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.

                                                                                                         

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© Scottish Life, St Andrew House, 1 Thistle Street, Edinburgh, EH2 1DG.
Scottish Life is a division of Royal London and markets products produced by Royal London. Royal London consists of The Royal London Mutual Insurance Society Limited and its subsidiaries. The Royal London Mutual Insurance Society Limited provides life and pension products, is a member of the Association of British Insurers and is authorised and regulated by the Financial Services Authority, registration number 117672. Royal London Marketing Limited acts as an insurance intermediary for general insurance products and is authorised and regulated by the Financial Services Authority, registration number 302391.