Lloyds Banking Group
The Lloyds Banking Group is well known for its retail and business banking brands such as Lloyds TSB, Halifax, and Cheltenham & Gloucester in England and Wales, and the Bank of Scotland which is one of the major banking providers in Scotland.
The Lloyds Banking Group is well known for its retail and business banking brands such as Lloyds TSB, Halifax, and Cheltenham & Gloucester in England and Wales, and the Bank of Scotland which is one of the major banking providers in Scotland.
However, in addition to banking, the Lloyds Banking Group also provides other financial services including wealth management, wholesale and insurance operations.
Leading player in UK insurance market
The Group's insurance business is a significant provider in the UK market, mostly under the iconic Scottish Widows brand with offices in Edinburgh and Bristol.
In this sector, Lloyds is the UK's leading bancassurance provider and has one of the largest intermediary sales forces in the country. It’s also the UK's largest home insurer – currently insuring one in five homes – and is the third largest general insurance provider.
The Group’s insurance division consists of two business units: Life, Pensions & Investments and General Insurance reporting to Toby Strauss who will join LBG as Group Director, Insurance from Aviva in October.
New Chief Actuary in position
Stephen McGee recently joined the Lloyds Banking Group as Chief Actuary for its Life, Pensions and Investment division and is responsible for the 100-strong actuary team in Scotland involved in making decisions about £130 billion worth of business.
He is based within the Scottish Widows brand that currently employs around 3,500 people in customer service, information technology, marketing and distribution, legal and compliance, finance, support, and, of course, risk.
Stephen, who has 17 years experience in senior actuary roles with Britannia Life, Abbey National, Pearl, Phoenix and AEGON, says the demand for good qualified actuaries has never been better as increased UK regulation has highlighted the importance of the risk-related work that actuaries contribute to the success of financial services sector.
Changing role of actuaries
He explained: “These regulations have changed the role of actuaries in the UK with a move away from assumption/rules-based analysis to a more risk-based approach.”
A current big issue in Europe is Solvency II, which involves a fundamental review of the capital adequacy regime for the European insurance industry. It has established a revised set of EU-wide capital requirements and risk management standards that will replace the current solvency requirements – and has created a big demand for actuaries within the financial services sector.
The revision of risk management standards has also been matched with a change in the mindset of actuaries as to the remit of their work, and the approach they take in interacting with their financial services’ colleagues.
Communication is key
Stephen said: “The focus now is on gaining a better understanding of the risk drivers and the organisation’s level of exposure to risk.” And in addition to this change of emphasis, actuaries are also having to become good communicators.
“It is vital that actuaries can convey the degree of risk exposure in a way that non-actuarial people, such as in product development, marketing and sales, can understand. These people need to appreciate the ramifications of this actuarial-led analysis on their plans and that of the overall business.
This is why I’m really looking forward to shaping my team to help meet the needs of the Lloyds Banking Group going forward,” added Stephen.