France
Total new business sales through Aviva France increased by 22% to £1,756 million (2003: £1,458 million), outperforming an estimated increase in the individual life and savings market of 17% during the first eight months of 2004.
Our largest distribution channel in France is with AFER, the country’s biggest savings organisation, with over 600,000 members and 28,000 new members joining in 2004. Total AFER production increased by 30% to £1,168 million, with nearly half of this growth from sales to new AFER members. This performance demonstrates the continued distribution strength of AFER and its ability to provide Aviva with access to new customers. Sales of single premium AFER euro products were 19% higher at £1,009 million (2003: £860 million), compared with estimated market growth of 11% during the first eight months of 2004.
The unit-linked market continues to benefit from more stable equity markets in 2004. Aviva France's sales of unit-linked and other savings products increased by 29% to £703 million (2003: £554 million) including strong growth in SFER, the unit-linked product sold through AFER accounting for 14% of total sales from AFER compared to 5% for the same period last year. Our strategy is to increase the percentage of our new business that is unit-linked where the market allows, through our control of our distribution networks and leveraging off the strong performance of Aviva Gestion d’Actifs. During the quarter we launched two new unit trust funds to AFER customers.
As anticipated, sales of our Plan d’Epargne Retraite (PERP) pension product, launched during the second quarter of 2004, have been moderate. Our focus is on clients with high average premiums which is the more profitable area.
We became the bancassurance joint venture partner of Crédit du Nord on 1 October this year when we acquired a controlling interest in Antarius and took over the administration of the existing portfolio. We have been encouraged by the level of new business sales generated in the past, which for the year to 2003 was £531 million, equivalent to 70% of non AFER business in 2003. The arrangement gives us exclusive distribution for life new business through Crédit du Nord’s network of over 600 branches.
New business contribution was £63 million (2003: £51 million), with a margin of 30.2% (full year 2003: 29.0%), reflecting the increased proportion of unit-linked sales.
