L&G said Lifetime mortgages will be offered to the increasing numbers of customers seeking to use the equity in their homes to supplement their retirement income.
Figures suggest the equity release market was valued at £1.4bn in 2014, with £14bn of business completed in the last 20 years.
Nigel Wilson, group chief executive, said: “The five global macro trends driving our strategy, ageing populations, globalisation of asset markets, welfare reform, digital connectivity and bank retrenchment create long term growth opportunities, which we position our businesses to capture.”
“The rapid growth of LGIM’s international business to over £100bn, the £5bn of investment in physical assets in the UK, and our entrance into the lifetime mortgage market are all examples of the successful execution of our strategy.”
On retail protection, gross premiums rose 7% to £1,056m and sales were up 11% to £165m from £148m in 2013.
The provider notes that the strength and breadth of its financial adviser distribution, which has grown sales to £99m, driven by the fact L&G is sole protection provider to 85% of building society membership.
However, L&G’s direct channel also continues to grow, with sales increasing 34%, now accounting for 16% of new business. This is a leap from 13% in 2013.
Also on distribution, the Legal & General Network facilitated £40bn of UK mortgages in the year, approximately one in six of all UK mortgages, but there was no detail on the Mortgage club in the results.
The group has posted an operating profit growth of 10% for the last year following strong performance of its retirement division.
The group posted operating profits of £1.28bn – up from £1.16bn in 2013. Its pre-tax profit increased by 8%, from £1.14bn to £1.24bn.
L&G’s retirement division saw the biggest growth after profits increased by 38%, from £310m to £428m.
L&G saw annuity sales grow by 61% in the period, achieving sales of £6.6bn (up from £4.1bn) – mainly due to bulk annuities, which made up £5.99bn.
It said it expected individual annuity sales to halve in the coming year as people take advantage of the pensions freedom.
Previous figures showed the firm had seen its individual annuity sales drop 40% in the first quarter of the year, with sales down from £406m in 2013 to £244m.
L&G said: “The changes introduced in the March Budget have introduced greater flexibility for individuals in retirement. We expect consumers to demand simple, tax efficient products that allow them to ‘cash-out’ their pensions and we have tailored our new products accordingly. We expect 2015 sales of individual annuities to be around 50% of 2014 new business volumes.
The group restructured its savings business ahead of the departure of the arm’s chief executive John Pollock in May this year, dividing it into ‘mature’ and ‘digital’.
It emerged in February the group’s pensions strategy director Adrian Boulding is to leave the provider this summer.