A distribution agreement that will see Nationwide Building Society sell Legal & General (L&G) protection, investment and pension products came into force today.
In return, L&G has bought Nationwide Life and Nationwide Unit Trust Managers for a total of £293m, a deal financed out of the £600m L&G raised through its Tier One capital issued in May last year.
Tim Breedon, group chief executive at L&G, says: “The strategic distribution agreement has the potential to become one of our largest.
“[We] will continue to develop and expand distribution in 2008, through banks and building societies, IFAs, platforms and direct to market.
“Each channel is strategically important to us and we see opportunities in each to grow market share.”
Graham Beale, Nationwide chief executive, adds: “This agreement enables Nationwide to focus on what it does best – distributing financial services products which are simple, accessible and straightforward for its 13 million members.
“In line with our policy of offering the best products from the leading providers in the market, we are now able to offer members a broader range of products to meet their protection and investment needs.
“For the first time an ethical trust will be available – an exciting new addition to a range of investment trusts, as well as innovative new policies like the family life insurance plan to protect families.”
Nationwide Building Society will offer unit trusts and ISAs investing in a range of L&G funds including the ethical trust, as well as offer other products such as family life insurance plan, capital guaranteed multi-index equity bond, critical illness cover and life cover.
However, we at www.howmuchcover.co.uk are confident that our Legal & General premiums will be cheaper than Nationwide’s due to the way we take less commission.