Insurance giant Aviva revealed a £10m hit from last week's storms as it recorded a fall in UK sales in the third quarter and admitted there remains 'much to do' under its recovery plan.

Latest trading figures showed worldwide new business was up 2pc to £171m in the third quarter, but fell 14pc to £91m in the UK.

Aviva added that losses from the St Jude's storm, which came after the third quarter, were expected to be in the region of £10m. Rival RSA Insurance has said the storms would cost it £65m after it wrought damage across the UK and northern Europe.

The Association of British Insurers said yesterday that total payouts of around £130m were expected as a result of the storm.

Aviva's third-quarter UK sales suffered due to reductions in the general insurance business across the market and tight competition on pensions.

Chief executive Mark Wilson hailed a 14pc increase in new business in the year to date for the overall group, citing growth in Turkey, Poland and Asia, while admitting it was still addressing depressed demand in Italy and Spain. But he reiterated previous guidance that this growth would 'moderate' in the final quarter of the year when compared with a strong period at the end of 2012.

It comes after the business announced plans in April to axe around 2,000 jobs – equivalent to 6pc of its global workforce.

In September, it departed with Robin Spencer, the chief executive of its Norwich-based general insurance division, just 14 months after handing him the job – Maurice Tulloch was named as his replacement.

Mr Wilson said: 'The turnaround at Aviva is still in its infancy; we have made progress this year and whilst there is room for optimism there remains much to do.'

The chief executive took charge in January after the departure of predecessor Andrew Moss.