Aviva, the British insurance giant, has reported a robust 13% increase in its gross written premiums for general insurance during the first nine months of this year.
The company has reaffirmed its commitment to returning surplus capital to its shareholders, highlighting its financial strength in the face of challenges like rising inflation and increased claims costs.
The insurer, which primarily operates in the UK, Canada, and Ireland, recorded general insurance premiums amounting to £8 billion (approximately $9.91 billion), a significant improvement compared to the previous year’s figure of £7.2 billion.
Aviva’s CEO, Amanda Blanc, emphasized the company’s strategy of expanding its capital-light businesses, which now constitute more than half of its portfolio.
Blanc expressed optimism about the potential for generating higher returns through capital-light growth in the future, emphasizing the prioritization of these segments.
Despite the impact of weather-related claims, Aviva expects to surpass its medium-term financial targets.
The company aims to achieve a 5-7% increase in operating profit this year, demonstrating its resilience in navigating a challenging operating environment.
Aviva also reiterated its guidance to pay a total dividend of around 33.4 pence for the year 2023, further emphasizing its commitment to providing regular and sustainable returns of surplus capital to its shareholders.
The insurer’s solvency ratio, a crucial indicator of its capital strength, remained strong at 200% in the third quarter, comfortably exceeding regulatory requirements.
This performance reflects Aviva’s robust financial position and stability, with a slight decrease from the 202% solvency ratio reported for the first half of the year.
Amanda Blanc highlighted Aviva’s progress in cost reduction efforts, noting that the company is on track to achieve its £750 million cost reduction target for the year.
This achievement is expected to be realized a year ahead of schedule, showcasing the company’s commitment to improving operational efficiency.
In addition to its strong financial performance, Aviva is reportedly exploring potential bids for the UK consumer operations of rival insurer RSA, underscoring its ambition to expand its presence in the insurance market.
This move aligns with Aviva’s strategic focus on growth and its commitment to delivering value to its shareholders.