Aviva’s recently appointed CEO Amanda Blanc has pledged to take “decisive action” after the insurer reported that operating profit had fallen to £1.2bn – down from £1.3bn the previous year.
In its interim results for the first half of the year, Aviva also revealed that operating capital generation increased to £890m, up from £780m in 2019.
General insurance operating profits decreased to £167m compared with £332 million the previous year. Net written premiums also remained relatively flat at £4.7 bn.
In the UK, it said Life and IS&R increased 11% to £581m (HY19: £522m).
Commenting on the results Blanc said: “We will focus Aviva on our strongest businesses in the UK, Ireland and Canada and aim to be the UK’s leading insurer. We are going to focus on those businesses where we have the necessary size, capability and brilliant customer service to generate superior shareholder returns. This is where we will invest and grow. Where we cannot meet our strategic objectives, we will take decisive action and we will withdraw capital.
“We must transform our performance and improve our efficiency. This requires great customer service, stronger innovation and better use of our brand. Our transformation will be underpinned by continuing to manage our balance sheet prudently, reducing debt and increasing our financial resilience.”
She added: “Aviva’s financial performance in the first half of 2020 was solid. Our financial position is strong and operating profit of £1.2bn was robust, thanks to our diverse range of products, excellent partners and our swift operational response to the COVID-19 pandemic. I am proud of the way our people have gone above and beyond to help our customers during this crisis.
“While the board continues to monitor the impact of Covid-19 and the economic outlook, we have decided to take the opportunity to review our longer term dividend policy, in light of our strategic priorities and the future shape of the group, with the objective of a sustainable pay-out and lower levels of debt. We will update shareholders on all dividend matters, including the 2019 final dividend in the fourth quarter.”