Life insurers have looked to the bulk annuity market for new business as individual annuity sales dwindle following British pension reform, which give retirees more freedom over what to do with their pension pots.

Bulk annuity business involves insurers taking on the risk of all or part of company defined benefit, or final salary, pension schemes.

L&G's operating profit rose to 750 million pounds in the six months to the end of June from a year earlier, against a forecast of 692 million pounds in a company-supplied poll.

Legal & General Investment Management's assets under management rose 12 percent from a year earlier to 715 billion pounds. But the asset management arm's AUM dropped by 3 percent over the second quarter.

L&G said it would pay an interim dividend of 3.45 pence a share, up 19 percent from a year earlier.

(Reporting by Carolyn Cohn, editing by Sinead Cruise)