Hibernian Aviva 'disappointed' as sales here fall 53pc – I Ind
HIBERNIAN Aviva yesterday admitted a "pretty disappointing" start to 2009 after the insurer's parent revealed a 53pc drop in sales at its Irish life insurance business. UK plc Aviva also commented on the "aggressive competition" in Ireland's general insurance market, but declined to give figures on that division, beyond noting the 9pc market share achieved by Hibernian Aviva Health.
The Irish soundings came as Aviva reported a 5pc rise in global sales to £10.3bn, including an 11pc rise in global life insurance sales to almost £9.6bn. Aviva also managed to allay investors' fears by revealing a 25pc improvement in its capital position over the last three months, prompting shares to jump almost 4pc in early trading.
"You'd have to say it was a pretty disappointing first quarter for us," Hibernian Aviva chief executive Stuart Purdy said yesterday, noting that the 53pc fall in his life and pension business came against a 45pc fall across the market.
"We're being hit harder because we had been doing very well in the single premium and savings areas, and they're both falling fastest now," he added.
"Our general business is holding up, and buy-out bonds (which people buy with redundancy lump sums) are growing."
"But it would be a challenge to achieve parity with the market falls this year."
The figures from Aviva show life and savings sales fell 63pc (in constant currency), while pensions sales were down 41pc. In its commentary, the plc attributed the declines to "volatile equity markets, the slowdown in economic growth and property market uncertainty". On the general insurance side, Aviva cited the "aggressive" competition in Ireland, but noted that Hibernian Aviva Health has achieved a market share of 9pc, with 200,000 customers, up from a market share of 4pc when the business was bought from Vivas in 2008.
Mr Purdy said his company had made good on previous promises to "harden" motor rates, and had put through "relatively modest" increases of about 5pc in the first quarter. Similar increases are expected to be put through on renewals throughout the rest of the year. Other insurers, including Quinn, also vowed to increase premiums this year.