Aviva achieves double-digit growth in Q3 2024 driven by diversified strategy

Aviva plc has reported a stellar performance in its Q3 2024 trading update, showcasing resilience and growth amidst dynamic market conditions. The UK-based insurance giant has leveraged its diversified portfolio and strategic focus on customer engagement to achieve double-digit growth across multiple business segments.

The update revealed a 15% year-on-year growth in general insurance premiums, climbing to £9.1 billion. This surge was driven by strong performances in both the UK and Canadian markets. Notably, UK and Ireland general insurance premiums rose by 18%, while Canada recorded an 11% increase, reflecting strategic pricing adjustments and robust new business development.

Amanda Blanc, Aviva’s Group Chief Executive Officer, emphasized the impact of the company’s diversified strategy and scale. She noted that Aviva has consistently delivered strong results, particularly in its capital-light businesses, underscoring the advantage of its large customer base, which has grown by 1.2 million over the past four years to 19.6 million.

Wealth and retirement sectors shine with double-digit growth

The wealth segment experienced a 21% increase in net flows, reaching £7.7 billion, fueled by strong demand for workplace pensions and the Adviser Platform. Retirement sales also surged by 67% to £7.3 billion, driven by bulk purchase annuity (BPA) volumes. The company reported a significant improvement in retirement margins, rising from 2.5% to 3.2%, highlighting disciplined capital allocation.

Operational strength supports profitability and growth

Aviva’s Solvency II shareholder cover ratio stood robust at 195% despite absorbing the impacts of increased BPA sales and natural catastrophe claims in Canada. The company redeemed €700 million in Tier 2 notes, reflecting prudent capital management.

Aviva also demonstrated strong resilience in underwriting, with a group-wide combined operating ratio (COR) of 96.8%, despite challenges posed by natural disasters in Canada. Excluding these events, the underlying COR showcased improvement due to effective pricing actions.

Ambitious growth targets reaffirmed

The update reaffirmed Aviva’s confidence in achieving its 2026 targets, including a £2 billion operating profit and £1.8 billion in Solvency II operating free generation. The company aims to grow its customer base to over 21 million by 2026 and expand the number of UK customers with multiple policies.

Aviva’s outlook remains positive, buoyed by its strong market position, robust capital base, and strategic focus on capital-light businesses. The company’s commitment to sustainability, highlighted by its net-zero ambitions for 2040, further underscores its long-term vision.

Aviva’s Q3 2024 trading update illustrates a company thriving on its scale, diversification, and customer focus. With double-digit growth across key segments and a strong financial position, the insurer is well-placed to navigate future challenges and capitalize on growth opportunities.