Aviva Plc · LSE:AV.
Aviva — Investor Day (May 2009)
25 slides from Aviva's investor day presentation, May 6, 2009
Slide 1: UK Life, Driving value through excellence
UK Life, Driving value through excellence Investor and Analyst Event, Wednesday 6th May 2009 Andrew Moss NUL18.11.08
Slide 2: Disclaimer
Disclaimer This presentation may include oral and written “forward-looking statements” with respect to certain of Aviva’s plans and its current goals and expectations relating to its future financial condition, performance and results. These forward-looking statements sometimes use words such as ‘an
Slide 3: Agenda
Agenda • UK Life in excellent shape Mark Hodges, Chief Executive Officer • Driving up profitability & generating capital John Lister, Finance Director • Delivering operational excellence Toby Strauss, Chief Operating Officer • Break and innovation demonstrations UK Life Management Team • Strategic o
Slide 4: UK Life: an evolving distinctive position - 2001 product positioning
UK Life: an evolving distinctive position 2001 – product positioning Pension 100% Savings 0% Risk 0% NU Savings 100% Pension 0% Risk 100% Consistent strategy & ruthless execution has delivered a distinctive position 4
Slide 5: UK Life: an evolving distinctive position - 2008 product positioning
UK Life: an evolving distinctive position 2008 – product positioning Pension 100% Savings 0% Risk 0% NU Savings 100% Pension 0% Risk 100% Consistent strategy & ruthless execution has delivered a distinctive position 5
Slide 6: Context for strategy: factors shaping the mid term
Context for strategy: factors shaping the mid term Industry past Forces for change Threats & opportunities Recession • Growth funded by • Capital conservation capital • Margin squeeze • Single premium driving RDR & TCF • Smaller IFA shop volume window • IFA channel pre- Distributor • IFA channel orp
Slide 7: Our strategy will drive consistent outcomes
Our strategy will drive consistent outcomes Successful outcomes • Driving in-force value Choices on future • Improved capital efficiency direction and focus • Cash generation • Profitable growth We are now in a position to make choices for the next 3 – 5 years 7
Slide 8: Five key strengths
Five key strengths Scale of Aviva customer A large and distinctive customer base base opportunity Unrivalled data and Risk capability capability All-round proposition Momentum in Corporate strength Distribution reach and Distribution strength and depth flexibility Brand Global re-brand These advanta
Slide 9: Agenda
Agenda • UK Life in excellent shape Mark Hodges, Chief Executive Officer • Driving up profitability & generating capital John Lister, Finance Director • Delivering operational excellence Toby Strauss, Chief Operating Officer • Break and innovation demonstrations UK Life Management Team • Strategic o
Slide 10: UK Life, Driving Value Through Excellence
UK Life, Driving Value Through Excellence UK Life • A distinctive customer heartland Market leadership • 5 areas of strategic focus & action • Summary of strategic direction Drive up profitability Purpose Prosperity & peace of mind Generate capital Vision One Aviva, Operational excellence twice the
Slide 11: We have a distinctive customer heartland
We have a distinctive customer heartland Customers Main needs Competitors Basis of competition High net worth Wealth managers Performance £500k + Complex wealth Banks, insurers Advice management Distributors Planning Mass affluent Fund managers £100 – £500k Middle market Packaged solutions Scale £30
Slide 12: Positioning based on deep insight: Life Stage
Positioning based on deep insight Wealth e bl y lth rs ch By r ta a Ri fo e e r w Lo ers ng m W iev pe or tti Co ch Su Po rn Ge A Ea Retired Overweight for UK Strong growth predicted Life Stage Pre-retired 8.6m unserved Family Higher average value Non-Family Our heartland is not only distinc
Slide 13: Opportunity from our existing customer base
Opportunity from our existing customer base Existing UK Life Customers UK Life customers (Millions) by source, m Direct, 1.3 40% have no active adviser Scaling back direct acquisition Have IFA, 3.5 Re-directing advisory resource No current Generating leads from existing advisor, 1.4 customer
Slide 14: Opportunity from our existing customer base
Opportunity from our existing customer base Aviva Life ~7m Customers 9% UK GI Customers Protection Investment 9m 33.2% 29.1% 1.9% • Cross product holdings low • Realistic cross holding Healthcare 1.6% <0.1% 0.4% <1% Customers opportunities 2.5m • Via on-sell and up-sell Pension 1.1% Annuity • Aviva
Slide 15: Opportunity from our unique Risk capability
Opportunity from our unique Risk capability Strong positions in key product sectors Market share 2008 Underlying market growth Annuities Annuity WP annuity WP Annuities Life cover - underprovided UK Unrivalled capability Mortality and morbidity Protection Asset / liability expertise Cutt
Slide 16: Opportunity from our momentum in Corporate sector
Opportunity from our momentum in Corporate sector (1) Aviva UK Life PVNBP £m 2,500 Momentum 2,000 • Proposition innovation • Case and tender sizes up 1,500 • 82 schemes Q1 • BPA foothold 1,000 • Global brand • Full wind down solutions 500 • Unrivalled combined capability pensions, BPA 0 2005 2006 20
Slide 17: Opportunity from our distribution reach post RDR
Opportunity from our distribution reach post RDR Advisers Today Advisers 2013 UK Life Strategy High net worth £500k + Independents Commercial focus c. 10,000 Mass affluent IFA £100k – £500k c. 21,000 Provision gap Grow in-house channel Middle market £30k – £100k General Advisors Tied / multi tied Le
Slide 18: Opportunity for synergy from Aviva's re-brand
Opportunity for synergy from Aviva’s re-brand What Does Norwich Union Do? Insurance (home or motor insurance) 73% Banking/ financial services 28% Life insurance 10% Mortgages 9% Pensions 8% Savings/ investments 6% Equity release / Lifetime mortgage 2% Transport/ travel 1% Other 11% Jan Mar Jul We wi
Slide 19: A strategy that delivers on economic realities
A strategy that delivers on economic realities 3 year outcome Metric Back book value creation VIF per customer Customer base value MCEV margin Margin and profitability IFRS profit Risk businesses Brand Growth above market % PVNBP growth Corporate leadership Own customers Distribution control added D
Slide 20: Our strategic focus
Our strategic focus Scale of customer 1. Capitalise on untapped value from existing customers base opportunity Unrivalled data and 2. Drive significant profitable growth in our Risk business capability Focussing on our All round distinctive 3. Drive significant profitable growth in Corporate sector
Slide 21: Delivery, positioning and a clear way forward
Delivery, positioning and a clear way forward Delivering our 2006 strategic promises • Rationalise costs 9 • Develop the business 9 • Simplify the legacy 9 • Strong balance sheet 9 • Value out of service 9 • Capital efficiency 9 • Manage retention 9 Trading through the Commercial mortgages recession
Slide 22: Agenda
Agenda • UK Life in excellent shape Mark Hodges, Chief Executive Officer • Driving up profitability & generating capital John Lister, Finance Director • Delivering operational excellence Toby Strauss, Chief Operating Officer • Break and innovation demonstrations UK Life Management Team • Strategic o
Slide 23: Questions & answers
Questions & answers Andrew Moss NUL18.11.08
Slide 24: Thank you and lunch
Thank you and lunch Andrew Moss NUL18.11.08
Slide 25: UK Life, Driving value through excellence
UK Life, Driving value through excellence Investor and Analyst Event, Wednesday 6th May 2009 Andrew Moss NUL18.11.08