The group’s portfolio of £33bn mature saving policies has been sold to Swiss Re for £650m, a decision Nigel Wilson chief executive said was hard but necessary.
"This was a difficult decision as with-profits savings has been a part of Legal & General's UK business for over 50 years.
L&G added the business being sold comprise mainly retail customers with traditional insurance based pensions, savings and investment products.
Assets include both unit-linked business and Legal & General's £21.4bn with-profits fund.
Legal & General presence in these areas will through workplace pensions, where it has 2.5mln customers, intermediated retail savings and ISAs and Unit Trusts sold directly to customers.
L&G expects to receive the £650mln proceeds at the start of 2018, with the formal completion in mid-2019.
The transaction is expected to boost L&G’s solvency by 2% and result in a one-off profits of £450mln.
The Mature Savings business generated £105mln operating profit last year., but Wilson said the sale would allow it to boost earnings by focusing on its market-leading businesses and to accelerate the scaling up of our growth businesses.