Liverpool Victoria Friendly Society Ltd., or LV=, is planning to convert to a company limited by guarantee from a friendly society, subject to members' vote at a May 22 special general meeting.
After conversion, LV= will be governed by the Companies Act instead of the Friendly Societies Act. Its mutual status, however, will not be changed.
Limited by guarantee status is used in the U.K. mainly by charities and other nonprofits, and implies that the company is guaranteed by its members, rather than by shareholders.
"Our friendly society status has served us well for many years but the Friendly Societies Act is becoming outdated and restricts our opportunities for growth and future development," group CEO Richard Rowney said. The company's board also believes that the outdatedness of the act "restricts its ability to manage the business effectively."
LV= also reported an operating profit of £136 million for full-year 2018, slightly up from £134 million in 2017. For the year, the group's profit before tax was down to £20 million, compared with £122 million in the previous year, with the insurer attributing the drop to deteriorating financial markets in 2018.