Aviva profits rise by 12 per cent

Insurer Aviva posted a 12 per cent increase in full-year operating profit to £3billion, boosted by growth in its fund arm, Aviva Investors, as well as its British, Canadian and Irish units.

Youngsters take part in the Aviva Community Fund 2016 launch campaign. Picture by Martin Parr.

Profit after tax fell 22 per cent to £859m, however, after adding in a £380m exceptional charge to cover the British government’s decision to lower the discount rate used to assess personal injury claim lump sum payouts.

The company, which employs 2,000 people in York and 1,300 in Sheffield, said its performance was helped by a strong rise in cash remittances from its various business units, up 20 per cent to £1.8 billion, helped by a 15 per cent rise in general insurance net written premiums to £8.2 billion.

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Life insurance operating profit increased 8 per cent to £2.6 billion, helped by growth in protection, pensions and individual annuities in the UK, protection sales and currency effects in Europe.

Fund management operating profit, meanwhile, rose 30 percent to £138 million, boosted by a rise in group assets under management.

Aviva said it was “actively planning to return additional capital to shareholders and reduce hybrid debt in 2017”.

“Aviva’s results are simple and clear cut: more operating profit, more capital, more cash, more dividend. And there is more to come,” Chief Executive Mark Wilson said in a statement.