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Legal & General buoyed by A-Day.

Insurance giant Legal & General yesterday reported a rush of new business ahead of the most radical overhaul of rules governing retirement saving for 50 years.

L&G, which employs 2,000 in Cardiff, said sales lifted 28% to pounds 363m in the UK between January and March as customers and their advisers prepared for the new regulations on April 6 - known as A-Day.

The key aim of the changes was to make the pension system simpler and to encourage people to save more towards their retirement. Instead of the eight previous tax regimes that previously governed pensions, there is now just one set of rules, ending the distinction between occupational pensions and private ones.

In a trading update Legal & General said pensions volumes grew by 32% over the first quarter to pounds 41m on an annual premium equivalent basis - the standard industry measure to iron out volatility.

This was due to good growth in pensions organised for staff by their employers and increased levels of transfer activity in the run-up to A-Day, the insurer said.

In addition, L&G said the preparations for A-Day spurred a 52% rise in new business from with-profits individual pensions to pounds 41m.

It added that a pick-up in the housing market was boosting business, with the recovery in mortgage application volumes at the end of 2005 feeding through to improved protection sales in the first quarter of this year.
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Title Annotation:Business
Publication:Western Mail (Cardiff, Wales)
Date:Apr 27, 2006
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