Worldwide long-term savings new business 9 months to 30 September 2007
Aviva North America
Total new business sales in the United States were £2,705 million (2006: £408 million) and pro forma sales have increased by 41%9 (pro forma 2006: £2,103 million). Aviva USA has delivered another record quarter of sales, including a particularly strong performance in the funding agreement business. The positive momentum is anticipated to continue for the remainder of the year although not necessarily at the exceptional growth rates experienced to date. The recent AM Best rating upgrade to A+ will act as an important catalyst for further growth in the United States.
Sales of annuities reached £1,975 million (2006: £367 million), a pro forma increase of 57% over the prior period (pro forma 2006: £1,374 million). Aviva USA increased its market share by the introduction of new products, a successful marketing campaign and the continued expansion of our distribution network.
Life sales were £401 million (2006: £41 million) representing a 7% increase on a pro forma basis. Lower margin traditional and universal life products were discontinued in 2007 as part of a product rationalisation process to focus on high margin indexed products.
Funding agreement sales, which are irregular in nature, totalled £329 million (pro forma 2006: £319 million) including one £126 million contract signed in September.
New business contribution increased to £96 million (2006: £9 million), an underlying increase of 41% on a pro forma basis. New business margin improved to 3.5% (2006: 2.2%), driven by the large funding agreement in September and a greater proportion of higher margin indexed product sales.
- 9. Pro forma increases are based upon the combined sales for the former Aviva business based in Boston and the former AmerUs Group for the 2006 year to date third quarter and are stated on a constant exchange rate basis. Comparative pro forma amounts are not restated for exchange rate movements.
