You are here: Home - News -

Aviva plans to increase average product holding per customer

by:
  • 06/08/2015
  • 0
Aviva plans to increase average product holding per customer
Aviva’s group CEO Mark Wilson says he ‘will not be satisfied’ until the insurer ups its average product holding per customer from the current rate level of 1.7 to 3.

As Aviva posted interim results revealing operating profits rose 9% to £1.1m in the first half of 2015 following its purchase of Friends Life, Wilson said there was more to be done for its growing customer base to ensure value for money and peace of mind.

Aviva’s half yearly results showed that its purchase of Friends Life which completed in March, has helped to boost revenue as its combined operating ratio improved by 2.4 percentage points, climbing to 93.1%. The performance of both Friends Life and Aviva combined saw it produce savings of £63m in the first half of 2015.

The value of new business is up by 25% to £534m, up from £444m during the same period last year.

Wilson said said the Friends Life integration process was running ‘ahead of schedule’.

“We are confident in our ability to deliver the £225m synergy target. Amidst the integration, UK Life VNB growth has improved significantly in the period.

“Strategically we are now more balanced, with scale across protection, retirement and savings. With circa 16 million UK customers in an increasingly disintermediated market, we have the opportunity to improve retention and increase the number of products held per customer,” he added.

“There is still more to be done for our enlarged customer base, in order to simplify their journey, ensure value for money and peace of mind. I will not be satisfied until our average product holding per customer has grown from the current level of 1.7 to above 3.”

Excluding Friends Life, the value of new business in Aviva’s UK Life business climbed by 31% to £232m, mainly reflecting higher margins on pension and health business combined with increased sales of bulk purchase annuities and equity release products. Aviva said this helped to partly offset the lower level of individual annuity volumes, following the announcements made in the 2014 UK budget.

Equity release and securitised mortgage loans held by the insurer’s UK Life arm now amount to £6.2bn, up from £5.9bn at the end of 2014.

Protection now makes up 40% of the group’s new business, with its reliance on annuities reduced to 17% of new business value. In the first half, new protection business increased 47% to £66m.

There are 0 Comment(s)

You may also be interested in