Aviva has reported a 22% year-on-year increase in group operating profit to £1.07 billion for the first half of 2025, up from £875 million in the same period last year.
The insurer also confirmed that 66% of operating profit was now generated from capital-light businesses.
Solvency II Own Funds Generation rose 20% to £909 million, while Solvency II Operating Capital Generation grew 33% to £957 million. The Solvency II return on equity reached 16.7%, up from 12.4% a year earlier, and IFRS return on equity increased to 20.6% from 14.8%. Cash remittances rose 7% to £1.02 billion.
Sales in insurance, wealth & retirement climbed 9% to £21.5 billion. General insurance premiums grew 7% to £6.29 billion, with an undiscounted combined operating ratio (COR) of 94.6% and a discounted COR of 90.4%, both improving from the prior year. IFRS profit for the period rose to £819 million from £654 million.
The group’s Solvency II shareholder cover ratio was 206%, compared with 203% at year-end 2024. Liquidity stood at £2.1 billion in July, up from £1.7 billion in January, while the Solvency II debt leverage ratio increased to 32.3% from 28.9%. The interim dividend rose 10% to 13.1p per share.
Comparatively, Aviva’s full-year 2024 adjusted operating profit before tax stood at £1.77 billion, representing a 20% rise from £1.47 billion in 2023. This figure exceeded market forecasts, which had been in the region of £1.67 billion.
Analysts at the time attributed the performance to the company’s focus on capital-light business lines, disciplined cost management and continued growth in general insurance and wealth. General insurance gross written premiums for the year reached £12.2 billion, up from £10.9 billion in 2023, supported by rate increases and underwriting actions.
Chief executive Amanda Blanc (pictured above) said the company had transformed its performance over the past five years.
“Today we are the UK’s leading diversified insurer, with a strong track record of delivery, and an unwavering commitment to our customers. We are very well positioned to accelerate growth in the capital-light areas of wealth, health and general insurance, and deliver more and more for our shareholders,” Blanc said.
Aviva also noted that the latest results exclude the financial performance of Direct Line Group, which the company acquired in July. Using Direct Line’s accounting policies, motor premiums were flat at £1.34 billion and non-motor premiums held at £500 million in the first half of 2025.
Motor policy count fell 6% to 3.7 million, while non-motor policies declined 4% to 4.9 million. The net insurance margin improved by 7.6 percentage points to 9.4%. Aviva said integration was progressing and expected the deal to add around 10% to run-rate earnings per share.
Following the acquisition, Aviva confirmed a new leadership structure for its UK and Ireland General Insurance operations. Jason Storah was appointed CEO of the combined division, while Owen Morris became CEO of personal lines, overseeing the integration of Aviva’s and Direct Line’s personal lines businesses.
UK and Ireland general insurance premiums rose 9% to £4.14 billion, with personal lines up 3%, supported by intermediated channels, including a travel partnership with Nationwide. Commercial lines grew 15%, aided by pricing measures, new business and the Probitas acquisition.
In Canada, general insurance premiums edged down 2% to £2.15 billion. The combined operating ratio remained at 94.7% for the first half of 2025, but the prior year’s performance had been affected by a higher COR of 98.5% in 2024, driven largely by severe weather events. These conditions placed pressure on claims costs, particularly in property lines, prompting the company to continue underwriting discipline and portfolio adjustments.
Leadership changes have also taken place in Aviva Canada. Last month, group CFO Nav Dhillon was named interim CEO following the departure of Tracy Garrad. At the same time, John Lally was promoted to chief claims officer.
Wealth net flows increased 16% to £5.8 billion, representing 6% of opening assets under management, which grew 6% to £209 billion. Health in-force premiums rose 14% to £1 billion, while protection sales fell 16% following product consolidation linked to the acquisition of AIG’s UK protection business.
Retirement sales fell 3% to £2.95 billion, reflecting lower bulk purchase annuity (BPA) activity. BPA sales were £2 billion during the period, rising to £3.1 billion by mid-August. Individual annuity sales increased 29%, though value of new business declined 10% to £94 million.
Aviva Investors originated £1.3 billion of real assets for the group’s annuities business, with around 65% of Workplace net flows invested in its funds. External net flows remained positive at £300 million.
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