Aviva’s recovery continues

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INSURANCE giant Aviva has revealed it is dealing with £60m of claims from damage caused by the UK’s floods and storms so far this year.

Despite the wide-scale disruption, the company said the figure is in line with the amount it normally sets aside for weather events in January and February.

The update came as the pensions, savings and general insurer signalled further progress in its recovery - rebounding from a loss of £2.9bn a year ago to profits of £2.2bn in 2013. Shares jumped as chief executive Mark Wilson said Aviva was now “simpler, more focused and better managed”.

Among other insurers, Direct Line Group has said it is expecting a hit of up to £110m from the storms and floods since the start of the year.

Aviva said floods in Alberta and Toronto also cost the group £129m last year while the December storms in the UK had a £60m operating profit impact, although this was offset by better weather earlier in the year.

Chief executive Mark Wilson said: “Our overriding focus is to help our customers affected by the bad weather and our teams of loss adjustors, surveyors and claims experts - the largest in the UK - have been on hand seven days a week, offering advice and support.”

In full-year results, Aviva said operating expenses fell seven per cent and the value of new business rose 13 per cent after a drive to exit low-margin, under-performing businesses. Operating profits were six per cent higher at £2bn.

However, Mr Wilson said the business was still a long way short of performing at its full potential.

He added: “I want to guard against complacency. Aviva still has issues to address. Have we made progress? Yes, some. Is it a little faster than anticipated? Probably. Have we unlocked the full potential at Aviva? Not yet.”