Aviva plc is holding a presentation today on its UK general insurance business, branded Norwich Union Insurance (“NUI”).
Aviva plc is holding a presentation today on its UK general insurance business, branded Norwich Union Insurance (“NUI”). Slides from the presentation are available on the Group’s website www.aviva.com and a delayed webcast will be available from around mid-afternoon.
NUI is the leading UK general insurer with a market share of 16% and has a focus on personal and small commercial lines. Net written premiums were Ł4.7 billion in 2002 with a combined operating ratio of 101%, against a group target of 102%, and statutory operating profits of Ł611 million. NUI makes a significant contribution to cash flows within the Group and achieved a return on capital employed of 16% in 2002.
Enquiries:
| Analysts / Investors | |
| Steve Riley, Investor Relations Director | +44 (0) 20 7662 8115 |
| James Matthews, Head of Investor Relations | +44 (0) 20 7662 2137 |
| Media | |
| Sue Winston, Head of Group Media Relations | +44 (0) 20 7662 8221 |
| Alex Child-Villiers, Financial Dynamics | +44 (0) 20 7269 7107 |
Main points from the presentation:
Consistent financial performance and a good start to 2003:
Application of scale advantages, a market leading claims process and rating increases together with continuing to re-shape the portfolio delivered a combined operating ratio of 102% and 101% in 2001 and 2002 respectively. We have seen a strong start to 2003, with double-digit rate increases in commercial property and liability business, and better than expected weather claims. Rate increases in personal lines have been relatively low.
Continuing to drive efficiency and improve returns
NUI maintains a market leading expense ratio at 10.4%, which includes expensing process improvements and new initiatives. We are off-shoring part of our customer services operation to India, to further improve our underlying cost base. These operations will be on-line from July 2003.
In 2002, claims costs savings of Ł100 million were achieved in areas such as improved terms for motor repairs and white goods, and the development of our own network of building contractors.
Developing new competitive advantages
NUI has developed a unique understanding of flood risks in the UK through digital mapping. This will improve risk selection and the accuracy of pricing for household insurance.
NUI is pioneering Pay As You Drive (PAYD™) technology in the UK motor insurance market, with exclusivity to the technology in the UK.
Developing new earnings streams
Whilst maintaining insurance at our core, NUI is developing a range of broader customer offerings, taking the opportunity to extend the trusted Norwich Union brand and create new profit streams. These initiatives include: NU Rescue and car provision.