The individual pensions and drawdown new business increased by 64% to £2.9bn. Meanwhile, the company’s new life and pensions business rose by 45% to £6bn – from £4.2bn in 2016.

“The strong new business performance in the first half of the year reflects growth in the overall market size and significant success in our proposition, particularly the Drawdown Governance service,” the British mutual life insurance and pensions company stated in its results report published today.

Royal London’s European Embedded Value (EEV) operating profit before tax increased by 34% to £185m, assisted by a 71% increase in strong new business profit of £149m, particularly in pensions, consumer and Royal London Asset Management.

George Osborne’s introduction of new pension legislation have led to an increased demand from savers to buy drawdown policies.

In November, regulator, the Financial Conduct Authority (FCA), capped a penalty imposed on savers for pulling out of retirement schemes early, in order to make it easier for them to switch between products.

According to Royal London, the FCA’s introduction of the early exit charge cap saw the company grow new business in 2017, primarily through its focus on “offering products which are good value for money”.          

“Our strategy remains to deliver excellent value for money by focusing on creating the best customer outcomes and best customer experiences at really competitive prices,” said Phil Loney, group chief executive of Royal London.

He added: “This philosophy is rooted in our status as a mutual. The growth in profit and new business sales we announce today underlines the continued success of our strategy.”

Royal London also said that the secondary market, where advisers recommend schemes move to take advantage of better quality scheme administration or investment options, is starting to emerge and that the company will increasingly focus on this market going forward.

Moreover, it will pilot a new Diabetes Life Cover product and use technology to enhance the company’s services to customers and advisers.