Aviva Europe
Aviva Europe's sales of long-term savings products, including investment sales, grew by 19% to £16,486 million (2006: £13,731 million), good progress against the medium-term target we set in October of growing long-term savings new business sales by an average of at least 10% a year to 2010. Life and pension sales grew by 15% to £14,914 million (2006: £12,840 million), reflecting strong growth across the region. Investment sales grew by 74% to £1,572 million (2006: £891 million), driven by strong inflows in the Netherlands and Poland.
Our businesses in Northern Europe achieved impressive growth with total sales up 22% to £9,147 million (2006: £7,456 million). This growth reflects sales of group pensions in the Netherlands, the continued success of our business in Ireland and a resilient performance in France.
In the Netherlands, Delta Lloyd’s life and pension sales have grown by 25% to £2,944 million (2006: £2,346 million), driven by group pension scheme sales, including £540 million from a single corporate client. Investment sales were 183% higher at £811 million (2006: £285 million), as a result of strong inflows into Delta Lloyd’s highly performing equity fund, and into the recently launched Delta Lloyd Europees Deelnemingen8 and Ohra New Energy Funds.
In Ireland overall life and pension sales grew by 35% to £1,730 million (2006: £1,273 million). The bancassurance channel continued to develop rapidly with sales up 46% to £864 million (2006: £589 million). The broker channel increased 26% to £866 million (2006: £684 million), reflecting higher sales to corporate pension clients. The growth in both channels has been supported by several new product developments and expansion of the fund range, including the launch of the Secure Capital Fund.
In Aviva France, sales grew by 2% to £3,662 million (2006: £3,552 million) in a market which declined overall in 20079 due to political and fiscal uncertainty in the first half of the year and equity market turbulence in the second half. Against this background, growth was achieved in the second half of the year through product innovation, including the modernisation of the AFER product, and successful marketing campaigns.
Sales in our businesses in Southern Europe grew by 9% to £5,316 million (2006: £4,827 million) in challenging market conditions in both Italy and Spain.
In Aviva Italy, total sales grew by 5% to £2,924 million (2006: £2,768 million), contrasting with the Italian market which declined by more than 5% during 200710. This favourable performance was generated by marketing campaigns, concentrated in the first three quarters of the year, and the continued development of relationships with our bank partners.
Aviva Spain’s life sales continued to show strong growth, up 15% to £2,392 million (2006: £2,059 million) despite sales of risk products affected by the slow down in the Spanish mortgage market. Sales of savings products were further boosted by the highly successful launch of the tax efficient PIAS11 product, in which we are the market leader and pension sales were boosted by the efficient transfer of a portfolio of pension policies into the new joint venture with Cajamurcia.
Sales in our businesses in Central and Eastern Europe have continued to grow strongly. Total sales grew by 55% to £1,530 million (2006: £973 million).
The life and pensions business in Poland has grown by 53% to £844 million (2006: £534 million). Pension sales increased by 86% reflecting higher sales to individuals entering the market for the first time and also our success in the secondary pension transfer market. Increased life sales of 29% were primarily driven by development of the bancassurance channel and the growth of our direct sales force. Investment sales increased by 97% to £268 million (2006: £131 million), reflecting the strong equity market performance and the launch of umbrella funds at the end of 2006.
Life and pension sales in our other Central and Eastern European businesses, in the Czech Republic, Hungary, Romania, Russia and Turkey, increased by 39% to £418 million (2006: £308 million), which included strong sales of savings products in Hungary and Turkey. In November the merger of Aviva Turkey’s life and pensions business with AK Emeklilik was completed, which will create a strong foundation for future growth.
- Delta Lloyd Europees Deelnemingen is a European equity fund.
- In GWP terms, the FFSA states that the French market for life individual products has declined 4% in 2007 compared to the 12 months of 2006.
- ANIA quotes market decline of 5.5%, based on new business single premium plus regular premiums, at the end of November 2007 compared to the first 11 months of 2006.
- PIAS are newly introduced savings contracts with tax benefits if they are in force for ten years and if an annuity is purchased at maturity.
