Aviva grows UK GI premiums and profits

Aviva’s UK general insurance combined ratio dropped one point to 95% in the first nine months of 2011 as net written premiums increased 12%.

Net written premiums for the UK GI business, excluding health and group reinsurance, were £3.3bn for the most recent nine-month period. This compares with £3bn in the same period last year and £2.2bn in the first half of 2011.

UK net written premiums including health and group reinsurance were £3.8bn for the first nine months of 2011 (9M 2010: £3.4bn).

Aviva’s 95% UK GI combined ratio compares with a group-wide non-life figure of 96%, down from 97% (9m 2010: 97%).

Aviva said the improved UK GI underwriting profit and premium growth reflected “our continued focus on excellence in underwriting and claims management,coupled with improvements in organisational efficiency and beneficial seasonal factors.”

Aviva described its exposures to the August riots in the UK as limited, thanks in part to careful risk selection.

Overall personal lines sales increased 16%, with personal motor net written premiums up 23%. Aviva now has more than two million customers and has added 318,000 new ones so far this year.

Aviva said business volumes and customer interest in its new aggregator insurance brand, launched on Gocompare, are “encouraging” and that it plans to launch on other aggregators soon.

Commercial lines net written premiums were up 5%. Aviva said it remained focused on maintaining profitability in the competitive commercial non-motor segment. The company added that it continued to make good progress in its Corporate and Specialty Risks unit as it builds its risk appetite and grows in line with its capability.

Aviva continues to see rate increases in personal motor (18% over the past year) and commercial motor (13%). Homeowner rates increased 7%. In commercial non-motor increases remained “in the low single digits”.

Aviva expects the restructuring of its UK operations, which will halve the number of regulated entities to boost its solvency levels, according to the EU Insurance Groups Directive, by £200m. The restructuring will be effective on 14 November.

Aviva also revealed that it had cut its exposure to the peripheral eurozone countries of Greece, Ireland, Portugal, Italy and Spain to £9.1bn as at 30 September from £9.4bn at the half-year point. The number excludes policyholder assets.