Insurer Aviva has admitted there will be no quick-fix to its problems after profits declined 10pc and it warned of more challenging conditions this year.

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The insurer, which has been the focus of shareholder anger following its lacklustre performance, has pinned its hopes on a restructuring drive that will see it eliminate non-core businesses and cut costs.

It has been encouraged by recent trading in the UK, where its motor and household insurance arm grew profits by 17pc on an underlying basis despite £40m of weather-related claims in June.

However, restructuring costs and lower returns from its life and pensions operations in the beleaguered eurozone lowered overall operating profits by 10pc to £935m.

Including a one-off write-down on the value of its US business, the group reported a net loss after tax of £681m.

Chairman John McFarlane, who is leading the restructuring drive following the summer ousting of chief executive Andrew Moss, said he believed the company’s three-year turnaround strategy was the right one.

“It is my sense that we have the right agenda, we have the people in place to execute it, and we are broadly on track with the programme we set out last month.”

Shares opened slightly higher today after Mr McFarlane kept the company’s half-year dividend at 10p a share.

He added: “Whilst this has been a challenging first half, we are taking the necessary actions to improve our position going forward.

“This environment is likely to continue and therefore we expect second half performance trends to be broadly similar to the first six months, but with higher restructuring costs as we implement our strategic plan.”

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