General Insurance

United Kingdom

We are seeing signs of a return to volume growth in 2010, reflecting the impact of our marketing initiatives, including our “Get the Aviva Deal” marketing campaign, rolling out direct pricing to insurance brokers and the success of the RAC panel. As expected, following the actions we took last year to reshape our UK portfolio, we are seeing good levels of retention in both personal and commercial lines business. There is also clear evidence that the personal motor market is starting to harden. The decline in net written premiums stopped in the first quarter, with premiums of £913 million. This represents a 4% increase over the last quarter of 2009 (4Q09: £880 million) and is a potential sign of a return to growth.

Aviva Europe

In the first quarter of 2010 sales increased by 33% to £597 million (4Q09: £448 million), broadly in line with the equivalent period last year (1Q09: £610 million). One of our key strategic aims is to increase general insurance sales through our leading bancassurance capability and this quarter we have had some early success with strong sales growth in Italy.

We are also now piloting our pan-European product centre in Ireland. Together with our claims transformation project this initiative will increase our ability to write business more profitably.

North America

Our Canadian business applied targeted rate increases and focused on business initiatives to improve our operational and underwriting effectiveness.

At £397 million, sales in the first quarter of 2010 were lower than the previous quarter (4Q09: £449 million), in keeping with established seasonal trends, but were 10% higher compared to the same period a year ago on a sterling basis (1Q09: £360 million) and level on a local currency basis. This is a good result in a highly competitive market.

Asia Pacific

On 9 April we re-entered the general insurance market in Singapore with the launch of the first, dedicated, direct online car insurance website. This builds upon our existing brand presence in Singapore and presents an attractive proposition for customers in the current market. Aviva’s investment in this initiative was in the region of £5 million.

Combined operating ratio

The Group general insurance combined operating ratio (COR) for the first quarter of 2010 was impacted by adverse weather in the UK and Europe, although this was partially offset by milder weather in Canada. We remain focused on delivery of a 98% COR for 2010.