General insurance and health
Operating profit
Our worldwide general insurance and health business reported an operating profit of £1,551 million (2004: £1,259 million), an increase of 22%, reflecting our sustained underwriting discipline, cost-cutting initiatives and innovative use of technology.
 Combined operating ratio |
 Growth in net written premiums |
 Growth in online sales in the UK |
 Savings from purchasing power |
 Roadside callouts attended |
New distribution channels
In the UK, we have signed a deal with Barclays to become its sole provider of homeowner, motor and travel insurance and extended our existing deal to be Asda’s sole provider of general insurance. Our online sales have increased by over 200%, making Norwich Union Direct one of the UK’s largest online insurance brands. In Canada, we extended our deal with Loblaws, the country’s largest supermarket chain, with product launches in Quebec and Alberta. In Ireland, our corporate partnership with Tesco moved from pilot stage into full roll-out.
| * | From continuing operations. |
| ** | On a UK GAAP basis. |
| † | Restated for changes to IFRS and discretionary changes to longer-term investment return methodology. |
RAC integration cost savings
We expect to achieve annualised cost savings of £100 million in 2006, exceeding the £80 million per annum cost savings target announced when RAC was acquired. We are making substantial progress on delivering revenue benefits, and expect to generate annualised operating profit of £250 million on a like-for-like basis from RAC by 2008, including an additional 1.4 million customers
Expanding on our insurance proposition
Our ownership of HPI vehicle information check specialists and Solus Accident Repair Centre enables us to provide a more complete range of motoring services to our customers, while gaining revenue and cost-saving benefits.
Leveraging group knowledge
Knowledge gained from HPI, digital flood mapping and our Pay As You Drive™ scheme has allowed us to improve our pricing decisions. Our Canadian business is now serviced by more than 150 staff in India, benefiting from cost and service advantages already seen in the UK.
| Operating profit £m | Net written premium* £bn | |
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Customer service is vital to the success of our business. In 2005, 92% of UK customers were satisfied with the sales service they received, and 83% with the handling of their claim. While these scores represent a significant achievement, we’re aiming higher in 2006 and are looking to set industry-leading standards. To achieve this we are implementing initiatives to understand, direct from customers, what they see as key elements of good service.
