Aviva (AV.) may be trading against a backdrop of feeble interest rates and economic uncertainty, but chief executive Mark Wilson remains confident. The facts are a great antidote for uncertainty, he says. Indeed, the life insurer performed well against all its important metrics during the first half of the year. Cash remitted to the group increased by more than half to £752m, while capital generated by the businesses totalled £1.2bn, supporting a 10 per cent increase in the dividend.
The UK and Ireland life business led the way in driving profit growth, with operating profit up a quarter to £711m. However, this was mainly due to an extra three months of contribution from Friends Life, which also boosted the life business's underwriting margin. Without this UK life generated a low to mid-single digit increase in operating profit. Improved protection sales and integration synergies helped. However, annuity sales declined by more than a quarter, as falling bulk annuity sales offset individual annuity sales, which were actually higher despite the advent of 'pension freedom'.