Interim results published by Aviva showed a marginal three per cent growth in operating profits in UK business. The group also revealed its plans to focus on corporate savings and protection for business growth in the UK market in 2011.
The firm’s operating profit for the first six months to June 2011 was reported at £709 million, a growth of 3 per cent over H1 2011. However, life business was down to £462 million from £463 million, recorded over the same period last year.
The interim management release said sales for group personal pensions were up a whopping 82 per cent while total pension sales went up by 33 per cent. Life and pensions sales put together, were up 5 percent at £5.4 billion for the first six months.
The results showed that Aviva managed to maintain 70 per cent of its own pensions customers while attracting 30 per cent of open market annuity business.
Operating profit across the group went up by 5 per cent to £1.3 billion.
During the first six months, the firm also diluted its stake in Dutch subsidiary Delta Lloyd to raise £0.4 billion and sold UK subsidiary £1 billion.
“Corporate business will be key in our future growth as employees increasingly look to their employer for endorsement of pensions and savings products as auto-enrolment of workplace pensions begins,” the firm said in a statement.
“We are increasing our position in the protection market and are the provider of choice to RBS and the Post Office. Our extended partnership with Santander, offering life, critical illness and income protection products to Santander customers through 1300 branches, direct and online will further strengthen our protection sales,” the statement added.
“We will build on this from the summer of 2012 with an enhanced agreement with Barclays for the distribution of a range of life protection and personal accident products through the bank’s non-advised sales channels,” the statement said.
The company is also planning to capitalise on regulatory changes such as the RDR (retail distribution review) and auto-enrolment.
“This has been a successful six months. We are beating all our operational targets. Operating profits rose in the UK and have increased by 21 per cent in Europe despite tough economic conditions,” said group chief executive Andrew Moss.
“After recent disposals, Aviva is fitter, stronger and well-positioned to be the undisputed leader in the UK market and to build on our strong European franchises. Markets may well continue to be volatile, but our strong balance sheet and capital position underpins our confidence in our continued momentum and our plans for growth,” he added.