Interim results - Worldwide long-term savings new business – Three months to 31 March 2006
Continental Europe
Ireland:
In Ireland, Aviva’s new business sales increased by 41% to £258 million (2005: £185 million), including sales of £93 million through the new bancassurance partnership with AIB, Ireland’s largest retail bank, since it began at the end of January. While in its early stages, progress on the integration of the Hibernian Life & Pensions and AIB operations is proceeding well. On a combined basis, Aviva and AIB have a market share of 16%2, making them the third largest life and pension provider. February and March sales through AIB of £93 million comprised £63 million of life sales, consisting primarily of single-premium bonds, and £30 million of pensions sales. Both life and pensions showed positive sales development compared with AIB’s sales for the same period in 2005.
Life sales through the existing Hibernian broker channel were 21% higher at £64 million (2005: £53 million), with strong sales of regular premium unit-linked business. This performance reflected the continued success of the guaranteed fund and favourable equity markets.
Pension sales through the existing broker channel were £101 million (2005: £132 million), with the decrease reflecting an exceptional level of investment only pension contracts in the first quarter of 2005. Single premium pension sales tend to fluctuate from quarter to quarter due to the timing and size of these contracts.
Further growth is expected in 2006 from the development of the product range on offer through AIB’s branch network and through the reinvestment of Special Savings Incentive Accounts (SSIA) that will mature between May 2006 and April 2007, in which AIB has a significant market share.
New business contribution was £5 million (2005: £6 million) with a margin of 1.9% (2005: 3.2%). The reduction in the margin reflects continuing competitive pressures from the year end and the impact of business mix.
2. Based on annual premium equivalent
