LV= shakes-up century old friendly society structure with overhaul

The UK’s largest friendly society LV= is ditching its 123-year-old legal structure and becoming a not-for-profit entity.

The insurer, founded as Liverpool Victoria in 1843, will use a similar company structure to healthcare giant Bupa, known as a company limited by guarantee, to maintain its mutual status.

LV= is currently a friendly society, a structure in place since 1896.

The overhaul should make the business easier to run: at present, LV= has to sell a certain amount of with-profits funds — which are becoming increasingly unpopular — while voter turnout rules are making resolutions harder to pass at annual meetings.

Chief executive Richard Rowney said: “We are trying to modernise our approach. At some point you have to do a bit of tidying up. Our mutual status is really important to us. We have no plans to change it.”

The move reflects the increasingly corporate nature of LV= over the past decade, underlined by a big tie-up with German insurer Allianz in 2017.

LV= paid a £26 million bonus to its 1.2 million members.

Separately, pensions mutual Royal London paid £150 million of profits out to 1.4 million members through a profit-share scheme.