Interim results - Worldwide long-term savings new business – Three months to 31 March 2006
Rest of the World
Australia:
Total sales increased by 28% to £379 million (2005: £287 million), driven primarily by significantly higher investment sales through Navigator, the master trust fund administration business.
Life and pension sales decreased marginally to £70 million (2005: £74 million). Strong growth from protection products has continued following product enhancements. Corporate pension sales have declined as a result of market uncertainty following changes in legislation in July 20056. These changes have resulted in a shift of business for Aviva towards Navigator retirement funds, with this trend expected to continue. Changes in tax legislation, implemented towards the end of 2005, are expected to have a beneficial impact on growth in corporate pensions over the medium-term.
Sales through Navigator increased by 55% to £264 million (2005: £166 million) as a result of ongoing improvements in product offerings, an increase in retirement fund business, sustained customer service levels and our strategic stakes; in Professional Investment Holdings and Financial Technology Securities. Other investment sales were £45 million (2005: £47 million).
Future growth is expected to result from these strategic stakes and pension reform, primarily benefiting the Navigator business. In addition, further growth in protection business is expected.
New business contribution from life and pension sales was £4 million (2005: £2 million). The new business margin increased to 5.7% (2005: 2.7%), reflecting the strong protection sales.
6. From 1 July 2005, for the first time, individuals were entitled to chose where superannuation contributions made on their behalf by their employer were directed. Previously the employer would chose the plan.
