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Aviva first quarter sales rise, estimates £160m in Covid-19 claims
[LONDON] British insurer Aviva posted a sharp rise in first-quarter new sales in its life business on Thursday, boosted by bulk annuities, but estimated £160 million (S$277.3 million) in claims related to the coronavirus pandemic.
Life new business sales rose by 28 per cent to £12.30 billion in the first quarter and general insurance net written premiums rose 3 per cent to £2.40 billion.
Aviva, which has operations in mainland Europe and Canada as well as Britain, said early second-quarter trends showed new business sales down across many of its divisions, as government lockdowns aimed at containing the virus hit the global economy.
The pandemic would provide "additional challenges" in meeting the insurer's 2022 targets, it said.
"The economic outlook remains uncertain and will affect our business," chief executive Maurice Tulloch said in a statement, adding that "the strength of our capital and liquidity means we are well-positioned to manage this crisis".
Most of the Covid-19 claims came from lines such as business interruption and travel, Aviva said.
Aviva is among a number of top insurers facing possible legal action from small firms in Britain who have not received payments for their business interruption insurance due to the pandemic.
The insurer said the "vast majority" of its commercial policies did not cover business interruption claims arising from Covid-19, but it had paid some claims in Britain and Canada where cover was in place.
The insurer wrote £1.7 billion in bulk annuities, a growing market which involves taking on the risk of company-defined benefit pension schemes.