INSURANCE giant Aviva reported a “significant year of progress” – but only after weathering the recession by slashing costs and trimming nearly 11,000 roles across its workforce.
The group reported a 3% rise in operating profits to £3.48 billion for 2009 and confirmed the first signs of an improving market as customers look to start saving again.
It said plans to cut costs by £500 million were a year ahead of target, having axed 10,700 jobs over the past two years - including a 30% reduction in its UK employee base.
Aviva will keep a “rigorous” control on costs in the UK, where figures revealed a tough market in 2009, with operating profits down 11% for the life business to £672 million and 18% lower for general insurance and health.
However, new business figures last month showed a marked rebound in the fourth quarter and raised hopes that the worst was behind it.
Aviva put its faith in the European life and pensions market for growth, just days after its rival Prudential unveiled a mammoth #23.5 billion takeover to capture more of the Asian market.
Andrew Moss, group chief executive, said: “We consider that Europe as a whole represents the largest and most attractive life and pensions market in the world.”
The European market – including the UK – has the potential to be worth some 1.7 trillion dollars (£1.2 trillion) within the next five years – “outstripping” the majority of Asia and North America, he added.
Aviva’s 2009 results come after the group stepped up its “One Aviva” strategy to simplify its structure and branding.
As part of this, the Norwich Union name disappeared last summer after more than 200 years.