Aviva plc is expected to fire on all cylinders when it publishes its first quarter update next week.
Berenberg says there are strong tailwinds for the insurance giant with margins improving after the re-pricing of UK motor insurance and another hike in UK household premiums.
Aviva is the UK market leader in home insurance, notes the broker, adding profitability should have improved in Canada, with a booming bulk purchase annuity (BPA) market, the acquisition of Probitas and a rapidly growing health insurance portfolio all adding to the current healthy mix.
Longer term, General Insurance (GI) accounts for around 50% of EPS and the division’s profits are expected to step up strongly over the next two years.
Deutsche Bank also expects good inflows in wealth, workplace, motor (due to premium increases) and commercial with Canada also likely to have good numbers.
“On the solvency front, we estimate a March 2024 figure of 203% (from 207% at end-2023),” but still a very strong number.