Aviva has seen strong sales growth across the market for private medical insurance (PMI) but its individual and group protection new business dropped after completion of the AIG Life deal.
CEO Amanda Blanc told Health & Protection the insurer was now the largest provider in the protection market, while it’s health insurance premiums broke the £1bn mark.
And she added that it had extended its PMI coverage to all employees, mirroring the trend for many other organisations with their PMI schemes.
Its first half results for 2025 revealed combined operating profit from the insurer’s protection and health business rose 24% to £86m from £69m a year earlier, but the there were mixed fortunes for the two divisions.
New group protection business fell 26% to £81m from £110m while individual protection business slipped 5% from £95m to £91m.
Protection operating profit increased by 23% to £57m from £46m driven by higher contractual service margin and improved mortality experience, meaning fewer claims.
Aviva reported the integration of AIG’s UK protection business, now operating as Aviva Protection UK (APUK), is “progressing well”.
Completed milestones achieved to date in 2025 include full operational separation from the seller, re-branding under APUK and securing directions hearing approval of the proposed Part VII transfer.
Health insurance saw new business rise 15% from £66m in H1 2024 to £76m in H1 2025.
It saw 14% growth of in-force premiums, which have now reached £1.0bn in H1 2025 up from £895m in H1 2024.
Health operating profit increased by 26% to £29m from £23m in H1 2024 driven by portfolio growth and an improved combined operating ratio in the low-90s.
Protection and health operating value added was also up 12% to £118m from £105m in H1 2024 which Aviva said reflected strong new business growth, partly offset by a lower benefit in the contractual service margin (CSM) from claims experience.
‘Brilliant’ growth
Taking a question from Health & Protection about the performance of Aviva’s health and protection divisions in a media call this morning, CEO Amanda Blanc (pictured) said there has been “brilliant” growth in the health business.
“This was 14% up, over £1bn in premium and what’s really exciting is that we’re seeing growth across all the channels of SMEs, consumer and large corporates,” Blanc said.
“We see that people are expanding the desire for colleagues, particularly in bigger organisations, for people to have more health and wellbeing protection.
“In fact, Aviva has provided full PMI protection for our colleagues in the first half of this year and we are seeing other corporates do that.
“So we see opportunities to grow both in terms of market share and also in terms of our proposition.”
Blanc added that CEO of insurance, wealth and retirement Doug Brown’s team was looking at protection and health together and connecting the insurer’s wellbeing proposition which she said was what employers are now expecting Aviva to do.
Two competitors
Turning to the performance of Aviva’s protection division, Blanc added: “With protection, with the acquisition of AIG, for the first half of the year, you effectively had both Aviva and AIG products in the market and therefore you had two competitors competing and also AIG had some very, very strong wins in that first half of last year.
“So simply what you are seeing is the fact that we now just have one product set which is what we expected would happen and the AIG integration is going really well,” she continued.
Blanc further added that Aviva was now the number one player in the protection market and had safely exited all of its service agreements from AIG.
“We’re ahead of plan on the revenue synergies and we’re on plan for the expense and capital, so I think it’s a really, really good performance from the team,” she concluded.
Across the group, Aviva saw operating profit rise 22% to £1,068m from £875m in H1 2024.
The period also saw Aviva begin the integration of Direct Line following completion of this acquisition on 1 July.
As the deal was completed after the period to which the interim results announcement applied, Direct Line’s H1 2025 numbers are not included in Aviva’s results.
