125
FINANCIAL STATEMENTS
6 SEGMENTAL REPORTING continued Segmental reporting and reconciliation to financial information
Year ended 31 December 2019
Year ended 31 December 2018
Insurance £m
Other £m
Total £m
Insurance £m
Other £m
Total £m
182.0
–
182.0
New business operating profit In-force operating profit Underlying operating profit
243.7
–
243.7
82.6
1.8
84.4
69.2
2.5 2.5
71.7
264.6
1.8 266.4
312.9
315.4
42.2
–
42.2
Operating experience and assumption changes Other Group companies’ operating results
(33.5)
–
(33.5) (14.6)
–
(13.1)
(13.1) (10.3) (66.6)
–
(14.6)
(7.1)
(3.2) (5.1)
Development expenditure
(6.4)
(2.3) (2.5)
(8.7)
(61.5)
Reinsurance and financing costs Adjusted operating profit before tax Non-recurring and project expenditure Implementation of cost saving initiatives Investment and economic profits/(losses)
(45.8)
(48.3)
238.2
(19.6)
218.6
227.2
(16.9) (15.3)
210.3
(3.8)
(4.5) (0.2)
(8.3)
(4.3)
(19.6)
(13.3)
(13.5)
–
–
–
173.7
0.1 173.8
(251.0)
(1.0)
(252.0)
14.0
2.8
16.8
Interest adjustment to reflect IFRS accounting for Tier 1 notes as equity
–
–
–
Profit/(loss) before amortisation costs and tax
408.8
(21.4)
387.4
(28.1)
(33.2)
(61.3) (24.2) (85.5)
(18.8)
Amortisation costs
Profit/(loss) before tax
368.6
Segmental revenue All net premium revenue arises from the Group’s insurance segment. Net investment income of £1,450.2m arose from the insurance segment and £1.5m arose from other segments (2018: £141.3m and £1.3m respectively). Segmental fee and commission income is presented in the disaggregation of revenue from contracts with customers below. Product information analysis Additional analysis relating to the Group’s products is presented below. The Group’s products are from one material geographical segment, which is the United Kingdom. The Group’s gross premiums written, as shown in the Consolidated statement of comprehensive income, is analysed by product below:
Year ended 31 December 2019 £m
Year ended 31 December 2018 £m
1,231.3
Defined Benefit De-risking Solutions (“DB”) Guaranteed Income for Life contracts (“GIfL”)
1,314.2
615.7
786.5
71.1
Care Plans (“CP”)
72.8
2.9
Protection
3.4
Gross premiums written
1,921.0
2,176.9
Drawdown and LTM products are accounted for as investment contracts and financial investments respectively in the statement of financial position. An analysis of the amounts advanced during the year for these products is shown below: Year ended 31 December 2019 £m Year ended 31 December 2018 £m Drawdown 26.7 51.0 LTM loans advanced 415.8 602.1
Reconciliation of gross premiums written to Retirement Income sales
Year ended 31 December 2019 £m
Year ended 31 December 2018 £m
1,921.0
Gross premiums written
2,176.9
(2.9)
Protection sales not included in Retirement Income sales
(3.4)
Retirement Income sales
1,918.1
2,173.5
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