Worldwide long-term savings new business – nine months to 30 September 2006
Aviva International
Continental Europe - Netherlands (including Germany, Belgium and Luxembourg):
Delta Lloyd’s total sales, including investment sales, were £1,927 million (2005: £2,289 million). The markets in which Delta Lloyd operates have been challenging in 2006, affected by competitive pricing, and by regulatory and fiscal changes. In addition, Delta Lloyd’s sales in Germany were £114 million (2005: £266 million) as a consequence of higher short-term interest rates. In this environment, Delta Lloyd continues to focus on achieving a balance between profitability and business volumes while seeking out new sales opportunities.
New business contribution was £45 million (2005: £56 million) with margins of 2.7% (2005: 2.8%). The 2006 margin incorporates the adverse impact of the 40 basis point decrease in the bond yield within the European Embedded Value assumptions at the start of 2006.
Life and savings sales were £697 million (2005: £976 million), with the reduction mainly due to lower sales in Germany and Belgium. In the Netherlands, savings sales have been affected by competition from alternative banking products. In Germany, investment bond volumes have been affected by the flattening yield curve. In Belgium, sales were lower following the introduction of a 1.1% insurance tax levy on life insurance premiums from 1 January 2006 and reduced margins available in the market.
Pension and annuity sales were £992 million (2005: £1,032 million). Volumes of annuity sales were lower at £249 million (2005: £328 million), reflecting high volumes in the first half of 2005 driven by limited period special offers in ABN AMRO and the direct channel. Delta Lloyd’s pension sales tend to fluctuate from quarter to quarter due to the timing and size of group contracts. A £27 million premium was received from the Delta Lloyd pension scheme in the current quarter in addition to the £125 million premium received earlier in the year.
Investment sales were £238 million (2005: £281 million) mainly comprising equity and bond fund sales through the Rabobank network.
