The largest insurance firm in the UK recently reported that its profits were up last year due to increases in its motor car insurance business in 2011, discount car insurance experts recently reported.
General insurer and discount car insurance provider Aviva announced its operating profits in 2011 increased by 6 per cent in comparison to the year previous, reaching a sum of £2.1 billion. The insurer, which registered 413,000 new customers in 2011, saw its UK motor insurance premium revenue jump to £1.1 billion, an increase of nearly a third on the previous year’s figures, while the insurer’s life insurance book also experienced a record year as profits soared to £931 million, an increase of 9 per cent.
Andrew Moss, Aviva chief executive, remarked that the firm continues to exhibit good performance even in the face of tough economic measures. Aviva made excellent progress in the UK market, Mr Moss added, as it grew market share and profits, with the firm also increasing its operating profits in Europe as well.
However, a liability revaluation along with other one-off charges caused the firm’s pre-tax profits to plummet 96 per cent to only £87 million. Insurers have the responsibility to estimate the value of their liabilities and investments, and the financial markets’ volatility has affected those calculations, with Delta Lloyd, Aviva’s Dutch unit, particularly affected.
However, operating profits have been strong once those accounting adjustments are excluded from consideration. Aviva’s growth in the Asian market performed particularly well, where profits increased by more than double to a sum of £70 million.