Aviva has insisted the IFA sector remains its “heartland” despite two new distribution deals with banks last week.
The firm has renegotiated its deal to distribute protection and pension products through Royal Bank of Scotland and has signed an exclusive five-year deal with Santander, which will see its life insurance, critical-illness and income protection products distributed through the bank’s UK branches.
Aviva also distributes products through Barclays and HSBC and says it is in talks with other banks regarding similar tie-ups. But chief executive of life and pensions Toby Strauss insists the firm is not turning its back on advisers. He says: “We are rebalancing our distribution because it helps us service the middle market so a lot of the headlines have been on the banking side but we are continuing to focus on our heartland, which is the IFA sector because we believe it is robust and will change and survive and we want to be there with them.”
The company saw profits for the first half of this year leap by 31 per cent on a market consistent embedded value basis to £1.3bn compared with £1bn for the first half of 2009.
Operating profit on an international financial reporting standards basis was up by 21 per cent to £1.27bn from £1bn in the first half of last year. Aviva has also increased its interim dividend per share by 6 per cent to 9.5p.
The firm’s UK life and pension business increased by 10 per cent in the period to £5.1bn from £4.7bn while protection sales grew by 14 per cent to £501m, up from £441m.
Individual annuities surged by almost 60 per cent to £1.1bn from £750m. Aviva says this is partly due to providers, including Prudential and Aegon, choosing to be less competitive on the open market.