Storm claims hit insurer Aviva

Aviva had total 2009 life and pensions sales of 32 billion, down 12 percent from 36.24 billion the previous year, the company said.

Analysts had expected sales of 31.3 billion on average.

The country's second-biggest insurer said its general insurance profits for 2009 would be dented by 100 million of claims for damage from storms in Ireland and the UK during the final three months of the year.

Aviva, which employs nearly 5,000 workers in York, Sheffield and Leeds, had a capital surplus of 4.5 billion at the end of 2009, compared with 2 billion a year earlier, the company added.

Insurers' shares fell steeply in early 2009 because of worries that sliding financial markets could erode their solvency capital, prompting companies across the sector to build up their reserves.

But Aviva said its life sales rose 21 per cent in the final quarter of 2009, and added that it was well-placed to benefit from an economic upturn in its major markets.

"We start 2010 in a strong position," chief executive Andrew Moss said.

Aviva shares closed at 398 pence on Wednesday, valuing the company at about 11 billion.