Craig Brown, chief operating officer of Legal & General Retail reflects on his time as chief executive of Legal & General Home Finance, and the future of the later-life industry.
As I take up an exciting new opportunity, I can’t help but reflect on the huge strides made by the later-life lending industry over the past few years.
Legal & General entered the sector in 2015 but, since I took the helm in 2022, I have seen a marked shift in how our products are perceived, despite some challenging market conditions.
As my colleague Lorna Shah leads the business into the future, I am confident that not only will the industry remain resilient but that it will enter even further into the mainstream.
A resilient industry
Why do I believe this?
The UK’s challenging economic context has made customers take a more cautious approach, and inevitably triggered changes in people’s needs.
As a result, lenders have evolved. It only follows that we need to keep innovating and listening to adviser feedback in order to provide products that truly support diverse customer circumstances as we look ahead.
We need to acknowledge that no customer journey is the same, and innovation is key to ensuring that we close any existing gaps.
During my time as CEO, the Home Finance business brought forward innovations to make property wealth more accessible for those who are looking to use it in their financial planning.
One of the most notable was the introduction of Payment Term Lifetime Mortgages (PTLM), a first-of-its-kind product for people aged over 50s.
This was designed to offer more choice for homeowners who are sitting on equity in their homes, but can’t access it because of their age and borrowing needs.
It garnered support from trade bodies such as the Equity Release Council, which updated its 'standards on mandatory payment lifetime mortgages', and brought an extra layer of reassurance to customers who are looking for improved borrowing options.
We have already seen others revising their product offering, just as we did in following past innovations.
We were, for instance, one of the first lenders to offer drawdown, so customers only access money as and when they need it, and this has now become more widespread.
What does the future hold?
Clearly, there is still work to be done to bring customers’ confidence back up and see growth in the market.
But I think the future looks bright. There is no doubt that lenders are collectively looking to support customer needs as best as they can and to offer innovative solutions.
One trend we’re likely to see is the mainstreaming of later-life lending.
Due to changes in customer attitudes, other pressure factors and the large amount of property wealth available to generation X, later-life lending will become increasingly more mainstream.
As such, it will be viewed as part of the broader mix of retirement products.
