Aviva sees new business leap after Friends acquisition

Aviva's offices in York
Aviva's offices in York
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​Insurance giant​ ​​Aviva said the value of new business jumped by a quarter in the first nine months of the year following its acquisition of rival Friends Life.

The ​firm, which employs 2,000 people in York and 1,300 in Sheffield,​​ revealed new business ​rose by 25​ per cent​ to £823​m over the period, notching up its ​eleventh​ straight quarter of growth.

Aviva snapped up Friends Life for £5.6​bn in April, sealing the industry’s biggest merger since 2000 and creating a group comprising 31,500 employees.

The firm said it has so far achieved £91​m of savings from the merger as part of its plans to make £225​m of annual savings from the deal by the end of 2017. It added its savings programme was ahead of schedule.

Earlier in the year it revealed it expects to slash 1,500 jobs, almost ​five per cent​ of its workforce, as it cuts a third of its offices.

Chief executive Mark Wilson said: “The acquisition of Friends Life is everything we expected it to be.

“At the same time our UK life business continues to grow and our customers are responding positively to the full range of pensions freedoms we offer.”

The industry had been left reeling by the annuity reforms, which took the insurance industry by surprise when they were announced by Chancellor George Osborne in last year’s March Budget.

However, analysts said Aviva is boosting its life insurance unit and offering a range a pensions options to bridge the shortfall in annuity take up across the industry.