Norwich Union customers get news on Aviva’s solvency
Norwich Union parent Aviva issued a statement to calm fears over it’s solvency position. Shares in Aviva, the UK’s largest insurer, had fallen in recent weeks reflecting uncertainty over the financial position of the company.
Aviva confirmed that surplus regulatory capital was estimated to have risen to £1.9 billion at 30 September 2008. The Company had also strengthened protection against further falls in global equity markets through increased hedges. It was claimed this hedging would protect Aviva to the extent that even a further 40 percent fall in equity markets would only reduce surplus regulatory capital by £0.7 billion. This is a significant improvement compared to its position in June 2008.
Following earlier clarifiaction over its exposure to AIG, exposure to Lehman Brothers was decsribed as within its risk appetite. CEO, Andrew Moss, confirmed that Aviva’s capital position remained strong, citing “active capital management” as the reason the company was robust enough to withstand recent market turmoil. He added that this provided “security for our customers and investors alike,ensuring that the group is well positioned as confidence returns”. This will no doubt be a relief for Aviva and Norwich Union customers alike.
