Aviva’s life insurance business up 25pc after Friends Life takeover
- Credit: Copyright Archant Norfolk Ltd
Aviva said its integration with Friends Life was 'ahead of schedule' as it revealed 25pc growth in its life insurance business.
Chief executive Mark Wilson said the peformance was further evidence that the company was 'maintaining the momentum' of its transformation, as the value of new business expanded by a quarter to £823m – its 11th straight quarter of growth.
The FTSE 100 company has made £91m worth savings so far since it sealed its £5.6bn takeover of rival insurer Friends Life. It is part of plans to cut 1,500 jobs and find £225m worth of annual savings in the wake of the merger, which was the biggest the industry has seen since 2000.
'We are maintaining the momentum of Aviva's transformation with a further quarter of improved performance,' Mr Wilson said. 'In life insurance,
value of new business was up 25pc, the eleventh consecutive quarter of growth. The general insurance combined ratio of 94.0pc is a more than adequate result. This level of consistency is important as we transform and grow Aviva.'
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Customers responded positively to the new pension freedoms rolled out by the government, Mr Wilson added, with Aviva's UK life insurance business expanding 36pc to £404m.
Next month, the company will transfer £23bn of Friends Life assets from AXA Investment Mangers.
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He added: 'The acquisition of Friends Life is everything we expected it to be. We have now achieved £91 million of savings against our target of £225 million. At the same time our UK Life business continues to grow and our customers are responding positively to the full range of pensions freedoms we offer.
'In asset management, our flagship fund range, AIMS, continues its strong investment performance and the Target Return Fund
has recorded returns of 6.6% over the past 12 months. AIMS now has £1.9 billion of funds under management. We expect this growth to continue.'
Aviva announced in July that it would create 400 jobs in Norwich as it moved to restructure the business following its takeover of Friends Life.
The insurer – which already employs 5,000 people in Norfolk – said it would transform Willow House into a 'centre of excellence' and create one of the biggest motor claims handlings sites in the country,
But the move would trigger the closure of motor claims offices in Manchester Albert Square and Stretford, where Aviva employs 440 people.
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