Aviva Plc · LSE:AV.
Aviva — Investor Day (April 2024)
33 slides from Aviva's investor day presentation, Apr 24, 2024
Slide 1: Health In Focus
Health In Focus 24 April 2024
Slide 2: Disclaimer & important information
Disclaimer & important information Cautionary statements This document should be read in conjunction with the documents distributed by Aviva plc (the ‘Company’ or ‘Aviva’) through The Regulatory News Service (RNS). This announcement contains, and we may make other verbal or written ‘forward- looking
Slide 3: Agenda
Agenda Welcome & Health In Focus introduction Q&A Charlotte Jones Doug Brown Steve Bridger Group CFO CEO MD IWR Health 3
Slide 4: Key messages
Key messages Health is a key business for Aviva Structurally attractive market set for 7-10% growth – with headroom for Aviva Market-leading propositions in Corporate, SME and Consumer, with benefit of diversified business mix and unique advantages of Aviva’s Group model Outpacing the market with a
Slide 5: Health is a core component of IWR
Health is a core component of IWR Insurance 1 Health supporting our strategy Health #3 Protection #1 Accelerating capital-light growth Wealth 1 Workplace #1 Driving customer acquisition c.12m Adviser Platform #2 IWR customers2 Advice >200 advisers Direct Wealth (relaunching) #16 Meeting more custome
Slide 6: Material growth opportunity for Aviva
Material growth opportunity for Aviva Growing UK Health Key business Important for market opportunity for Aviva today our strategy £861m +37% In-force Premiums In-force Premiums vs. 2020 £5.2bn Capital-light growth Gross premiums 20221 £151m 1.2m New Business APE Customer lives insured +275k vs. 202
Slide 7: Aiming for strong profit growth
Aiming for strong profit growth Consistently strong performance… … with growth ambition over the next 3 years In-force Premium (£m) +9% £100m CAGR £861m £615m Operating profit by 2026 Low-90s COR1 2019-2023 underpinned by 2019 2020 2021 2022 2023 New Business APE (£m) 80 76 93 107 151 Double-digit i
Slide 8: Well positioned for growth in an attractive Health Market
Well positioned for growth in an attractive Move image to innovation section and Health Market replace with other image
Slide 9: Attractive market set for structural growth
Attractive market set for structural growth Fundamental societal trends… … underpinning accelerated market growth Growing pressures on public healthcare UK Health market, GWP (£m)1 £8.4bn Waiting list of >7.5m people today vs. 4.6m pre-pandemic +7-10% £7.3bn CAGR +7% Expanding role of the employer +
Slide 10: Aviva well positioned for growth
Aviva well positioned for growth Strong #3 in a concentrated market Leading propositions & capabilities UK Health market share, latest view1 Market-leading propositions Wellbeing-led for corporates, value-based for SME & consumers 37% Leading distribution Strong broker & EBC relationships, growing D
Slide 11: Diversified business benefitting from Aviva's Group model
Diversified business benefitting from Aviva’s Group model Diversified business mix across segments Benefitting from Aviva’s Group model Corporate & Trust Consumer #1 insurance franchise with £351m in-force £277m in-force 16m Aviva UK customers 618k lives 272k lives 32% Leading Aviva broker relations
Slide 12: Advantaged by our wellbeing-centred proposition
Advantaged by our wellbeing-centred proposition Clinical treatments for physical health… Clear benefits for Aviva Higher customer satisfaction Aviva Digital GP BacktoBetter >90% Aviva Digital GP users likely to recommend Aviva … leading mental health pathways… Increased customer engagement 6 in 10 A
Slide 13: Supporting our customers & society
Supporting our customers & society By condition: Musculoskeletal Reduce over-medicalisation & waste in our Head & neck supply chain and through guided pathways >325k Gastrointestinal # customer Mental health claims Oncology Other Improve health affordability by increasing accessibility for underserv
Slide 14: Maintaining a strong COR through disciplined management
Maintaining a strong COR through disciplined management Growing provider leverage Managing claims inflation Strong partnerships with nationals New 3-year contracts with key providers Low-90s 1.7x guided claims spend vs. pre-pandemic Controlled referral process Combined operating ratio1 Maintained fo
Slide 15: Clear strategic priorities to drive future growth
Clear strategic priorities to drive future growth 1 2 3 Disciplined growth Accelerating Innovating to in Corporate growth in support our & Trust Consumer & SME customers 15
Slide 16: Disciplined growth in Corporate & Trust
1 Disciplined growth in Corporate & Trust
Slide 17: Outpacing the market in Corporate & Trust
Outpacing the market in Corporate & Trust Corporate & Trust In-force Premium (£m) Trust +10% £351m Corporate CAGR £244m Clear structural growth drivers Aviva a top player with leading capabilities 2019 2020 2021 2022 2023 Aviva’s Group model a unique advantage Lives 503 521 544 573 618 Insured (k) M
Slide 18: Attractive segment with structural growth drivers
Attractive segment with structural growth drivers Consistent growth in UK workforce c.25m people in full-time employment, +2.7m vs. 2013 £2.0bn Increasing focus on employee health Gross premiums, 20221 4 in 10 employers intend to increase support with PMI Transition to “whole-of-workforce” benefits
Slide 19: Corporate proposition underpinned by leading capabilities
Corporate proposition underpinned by leading capabilities Optimum – Aviva’s PMI offering for companies with 250+ employees Leading benefits proposition Flexible cover to suit different corporate needs DE&I benefits across neurodiversity, menopause & fertility Optional benefits to help keep employees
Slide 20: Unique advantage of Aviva's Group model
Unique advantage of Aviva’s Group model Waterfront corporate benefits proposition… … deepening our relationships 1 in 3 UK companies have a policy relationship with Aviva1 36% Of these companies have products Commercial Group Workplace across 2+ Aviva business lines Lines GI Protection Private Pensi
Slide 21: Material opportunities for disciplined growth
Material opportunities for disciplined growth Leverage Continue to secure new business and outperform on retention through +8pp Aviva relationships Aviva Group active account management of key Aviva corporate relationships with UK companies, 2023 vs. 20221 Grow Build from a position of strength with
Slide 22: Accelerating growth in Consumer & SME
2 Accelerating growth in Consumer & SME
Slide 23: Accelerating in Consumer & SME
Accelerating in Consumer & SME Consumer & SME In-force Premium (£m) SME Expert Select +8% £510m launched in 2021 CAGR Consumer £371m Increasing demand post-pandemic Market-leading Expert Select proposition 2019 2020 2021 2022 2023 Benefits of value-based healthcare model Lives 433 424 474 531 603 In
Slide 24: Increasing demand post-pandemic
Increasing demand post-pandemic Heightened awareness of health & wellbeing >50% of new policies for a large Aviva writer are first-time PMI users £3.2bn Increased demand for speed of access Gross premiums, 20221 >45% of people consider quick treatment a benefit of PMI Growing role of digital-first s
Slide 25: Market-leading Expert Select proposition
Market-leading Expert Select proposition PMI cover for consumers, and SME cover through our Solutions product Expert Select Flexible cover to suit different SME & consumer needs Strong customer outcomes with guided pathways Individual, joint & family options for consumers Cost-effective networks Sui
Slide 26: Benefits of value-based healthcare model
Benefits of value-based healthcare model Quality guiding Customer-centric approach… Excellent providers, pathways & networks 15% >90% Premium discount Specialist appointments Clinical oversight with Expert Select booked on initial call Evidence-based treatment & great outcomes … with strong clinical
Slide 27: Range of opportunities to accelerate growth
Range of opportunities to accelerate growth Grow Direct Enhancing Direct proposition to meet more customer needs, diversify >55% & with Aviva New Direct sales distribution, and capture share in >£1bn Direct Consumer market to existing Aviva customers customers, 2023 Grow SME has been our fastest-gro
Slide 28: Innovating to support our customers
3 Innovating to support our customers
Slide 29: Enhancing our digital-led connected wellbeing proposition
Enhancing our digital-led connected wellbeing proposition Aviva Digital GP >390k Video consultations 24/7 booking & around-the-clock availability Registered users Choice of GP Review profiles and select based on needs Mental health toolkits >145k 2023 appointments Paediatric consultations +50% vs. 2
Slide 30: Innovating for our customers
Innovating for our customers Expanding our proposition with key strategic partnerships [..] [..] Support customers in Leading reproductive every aspect of their health benefits cancer treatment & wellbeing support Helping workforces to thrive with leading DE&I benefits >2,200 150 Empower employees t
Slide 31: Key takeaways
Key takeaways Health is a key business for Aviva Structurally attractive market set for 7-10% growth – with headroom for Aviva Market-leading propositions in Corporate, SME and Consumer, with benefit of diversified business mix and unique advantages of Aviva’s Group model Outpacing the market with a
Slide 32: Q&A
Q&A Welcome & Health In Focus introduction Q&A Charlotte Jones Doug Brown Steve Bridger Group CFO CEO MD IWR Health 32
Slide 33: Footnotes
Footnotes Slide Reference Footnote 4 1 Undiscounted combined operating ratio. 1 Aviva's analysis using information available including company reporting, Boring Money, Corporate Adviser, Fundscape, LaingBuisson, Milliman, Swiss Re Group Watch, UK Finance. 5 2 Individual customers. 6 1 Based on ABI d