Aviva reports steep rise in profits off the back of Norwich-based general insurance division
PUBLISHED: 09:57 03 August 2017 | UPDATED: 10:01 03 August 2017
Aviva has reported a sharp rise in first-half profits after it was boosted by its general and life insurance divisions.
The Norwich-based insurer said operating profit grew 11% to £1.46bn in the first six months of the year.
Aviva’s general insurance and health profits increased 25% to £417m, aided by the acquisition of RBC Insurance in Canada last year, as well as foreign exchange benefits.
The group, which has its UK general insurance arm at Surrey Street, also announced it had agreed a 10-year deal with HSBC to continue offering products to the bank’s customers – which Aviva boss Mark Wilson said would be worth “hundreds of millions of pounds in terms of premiums”.
Life insurance operating profit grew 8% to £1.3bn after it saw double-digit growth in long-term savings, protection and annuities and equity release.
As a result, Aviva is increasing its interim dividend by 13% to 8.4p.
Chief executive Mark Wilson said the firm is “getting the basics right”.
He said: “For the fourth year in a row we have grown operating profit, up 11%, reflecting positive performances across Aviva’s businesses worldwide.
“We are growing and investing in the UK. We have grown top-line sales and bottom-line profit in UK general insurance, pensions, annuities and protection. Our digital business continues to make progress, making insurance simpler and more convenient for customers.”
Mr Wilson said Aviva, a member of the EDP/EADT Top 100 list of the highest turnover companies based in the region, had benefitted from being a household name during the political uncertainty and fallout from the EU referendum.
He said: “We have grown our market share pretty much across the board. When you have uncertainty people tend to get attracted towards the bigger brands and that has worked in our favour.”
Net written premiums in the general insurance business lifted by 11% to £4.68bn, while the value of new business rose 27% to £596m.
Mr Wilson said one of the focuses for the first six months had been to simplify the group by selling off “apple tree” businesses, those which require restructuring, including the majority of its Spanish arm for €475m and Friends Provident International for £340m.
Aviva said Norwich, where it employs 5,000 people, continued to be one of its core sites and its largest in the UK.