AM Best Affirms Credit Ratings of Legal & General Group Plc and Its Rated Subsidiaries

LONDON--(BUSINESS WIRE)--AM Best has affirmed the Long-Term Issuer Credit Ratings (Long-Term ICR) of “a” (Excellent) of the non-operating holding company, Legal & General Group Plc (L&G) (United Kingdom). Concurrently, AM Best has affirmed the Financial Strength Rating of A+ (Superior) and the Long-Term ICRs of “aa-” (Superior) of L&G’s rated subsidiaries, Legal and General Assurance Society Limited and Legal & General Reinsurance Company No. 2 Limited. The outlook of these Credit Ratings (ratings) is stable.

The ratings reflect L&G’s consolidated balance sheet strength, which AM Best assesses as very strong, as well as its strong operating performance, favourable business profile, and appropriate enterprise risk management. The ratings of L&G’s rated subsidiaries factor in their strategic importance to L&G and their integration within the group.

L&G’s balance sheet strength assessment is underpinned by its risk-adjusted capitalisation, as measured by Best’s Capital Adequacy Ratio (BCAR), at the strongest level. The group’s risk-adjusted capitalisation includes a meaningful contribution from economic capital embedded in its long-term business and equity credit for hybrid debt, as these are considered of weaker quality in the capital structure. The assessment also factors in the group’s excellent financial flexibility, through its access to capital markets, coupled with good fungibility of capital. L&G’s consolidated adjusted financial leverage at year-end 2025, excluding and including contractual service margin (net of tax), was 52.2% and 15.3%, respectively (as measured by AM Best). Interest coverage is considered to be adequate.

L&G has a track record of strong operating performance, evidenced by a four-year (2022-2025) average return on equity of 12.2%. The results of the institutional retirement and the retail divisions have been the main drivers of returns over that period. Overall performance in 2025 improved, as compared to 2024, with reported net profit of GBP 616 million (2024: GBP 195 million). Performance during the first half of 2026, was strong with L&G reporting increases in core operating profits across all divisions.

L&G holds a leading position in the United Kingdom market across pension risk transfer (PRT) deals, protection products and asset management services. The group benefits from good diversification of earnings with a comprehensive offering of end-to-end pension de-risking and retirement solutions. Following the sale of its U.S. operations to Meiji Yasuda Life Insurance Company (Meiji), L&G is maintaining its presence through taking an 80% economic interest in new and existing U.S. PRT business through reinsurance agreements, as well as serving in an asset managerial role. Moreover, the group’s asset management division provides a further degree of diversification to its business profile as one of the largest asset managers worldwide.

This press release relates to Credit Ratings that have been published on AM Best’s website. For all rating information relating to the release and pertinent disclosures, including details of the office responsible for issuing each of the individual ratings referenced in this release, please see AM Best’s Recent Rating Activity web page. For additional information regarding the use and limitations of Credit Rating opinions, please view Guide to Best’s Credit Ratings. For information on the proper use of Best’s Credit Ratings, Best’s Performance Assessments, Best’s Preliminary Credit Assessments and AM Best press releases, please view Guide to Proper Use of Best’s Ratings & Assessments.

AM Best is a global credit rating agency, news publisher and data analytics provider specialising in the insurance industry. Headquartered in the United States, the company does business in over 100 countries with regional offices in London, Amsterdam, Dubai, Hong Kong, Singapore and Mexico City. For more information, visit www.ambest.com.

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