View more on these topics

Aviva UK Life profits rise 5% as costs plummet

Aviva’s UK Life business delivered a 5 per cent increase in operating profit during 2013, from £886m in 2012 to £930m last year, driven by a 16 per cent drop in expenses.

Aviva’s annual results, published last week, reveal group-wide profits rose 6 per cent year-on-year, from £1.93bn in 2012 to £2.05bn in 2013.

This is partly due to a significant cost-cutting effort during the year which saw the firm reduce expenses by 7 per cent, from £3.23bn in 2012 to £3.01bn last year. In August 2012 the group announced plans to cut costs by £400m across its global operations.

In Aviva’s UK Life arm operating expenses fell from £675m in 2012 to £569m in 2013.

Aviva says this came as a result of “delayering management structures, distribution rationalisation and prioritisation of IT and change initiatives”.

Aviva group chief executive Mark Wilson says: “The turnaround at Aviva is intensifying.

“We have focused the business on ‘cash flow plus growth’ and the benefits are starting to be reflected in our performance.

“Following our exit from a number of low margin, underperforming or non-strategic businesses, Aviva is simpler, more focused and better managed. 

“Although we have made progress in 2013, I want to guard against complacency. Aviva still has issues to address.

“Have we made progress? Yes, some. Is it a little faster than anticipated? Probably. Have we unlocked the full potential at Aviva? Not yet.”

Rowley Turton director Scott Gallacher says: “As long as this is taking out unnecessary costs and duplication that is all for the good.

“The concern would be if they are cutting costs for the sake of it because that could have a potential impact on the service advisers and their clients receive.”

Newsletter

News and expert analysis straight to your inbox

Sign up

Comments

    Leave a comment

    Close

    Why register with Money Marketing ?

    Providing trusted insight for professional advisers.  Since 1985 Money Marketing has helped promote and analyse the financial adviser community in the UK and continues to be the trusted industry brand for independent insight and advice.

    News & analysis delivered directly to your inbox
    Register today to receive our range of news alerts including daily and weekly briefings

    Money Marketing Events
    Be the first to hear about our industry leading conferences, awards, roundtables and more.

    Research and insight
    Take part in and see the results of Money Marketing's flagship investigations into industry trends.

    Have your say
    Only registered users can post comments. As the voice of the adviser community, our content generates robust debate. Sign up today and make your voice heard.

    Register now

    Having problems?

    Contact us on +44 (0)20 7292 3712

    Lines are open Monday to Friday 9:00am -5.00pm

    Email: customerservices@moneymarketing.com