Hibernian life pensions announce new business results

6th February 2007

Hibernian Life Pensions today announced its new business results for the year ending 31 December 2006. The results mark the end of the first eleven months of trading for the joint venture with Allied Irish Banks (AIB). The deal, through which Hibernian acquired AIB’s life insurance subsidiary Ark Life, was signed at the end of January 2006.

Total sales on an annual premium equivalent basis were up 15% to €281.2m (2005: €245.5m) for both parties to the joint venture and market share now stands at 16.7%.

Life single premium sales were up 55% across both channels. The re-opening of the property fund proved especially attractive to bank customers and sales reached €71.9m. A number of new products including a rollover product designed to capture maturing SSIAs are expected to keep life sales buoyant for 2007.

Stuart Purdy, chief executive, Hibernian said:

“2006 was a busy year for Hibernian. Following the completion of our joint venture with AIB we brought staff from both Hibernian and Ark Life together into our new city centre offices We also successfully launched new product into the bank channel, and strong sales indicate that we are fulfilling customer demand.”

Life single premium sales through the broker channel specifically were up 21% to €248.0m (2005: €198.8). This can be attributed to strong sales of unit-linked business reflecting buoyant market conditions and the continued success of the Guaranteed Fund, which closed last June. The Secure Capital Fund, which has just been launched, will provide customers with similar attractive guarantees in 2007.

Single premium premium pension sales were also strong, up 14% overall to €440.38m (2005: €385.42). Sales were particularly buoyant in both broker and bank channels during the fourth quarter traditional pension season, with new funds introduced for AIB customers and enhancements to our pension products available through the broker channel. Annual premium pension sales also grew by 7% to €117.2m (2005: €109.45m), again sales were stronger towards the end of the year.

Annual premium life sales were down 5% across both channels on last year. Hibernian attributes this downturn to the loss of a key distributor early in the year, as well as increased competition in the protection market and some slowdown in new mortgage sales towards the end of the year.

Hibernian’s broker business is continuing to experience a level of lapses higher than previously projected within its assumptions for life and pensions business. Disclosure of the impact of changes to assumptions on Aviva’s 2006 full year results will be provided in the preliminary announcement on 1 March 2007.

About Hibernian

Hibernian Group is Ireland’s largest composite insurer, ranked first for general insurance and top three for life and pensions.
Hibernian Group is a subsidiary of Aviva plc, the world’s fifth-largest insurance group and the UK’s largest insurance services provider (based on gross worldwide premiums at 31 December 2005), and is one of the leading providers of life and pension products to Europe, with substantial positions in other markets around the world. Aviva employs 58,000 staff worldwide.
Aviva’s principal business activities are long-term savings, fund management and general insurance, with worldwide total sales of £41.5 billion and assets under management of £364 billion at 31 December 2006.
Morley is the UK-based asset management business of Aviva plc. Firms within the Morley group of companies manage £169bn (€247bn) from offices around the world as at 30 April 2007.
With a strong track record in the property arena, Morley has seven European property funds focusing on a range of sectors and markets and over the last 24 months has acquired over 50 properties in 11 countries. These funds account for over €1.1bn of European assets under management.
In 2006 Morley Fund Management won two awards at the Central and Eastern European Real Estate Quality awards taking ‘Outstanding Company of the Year’ and ‘Investor of the Year’ for its Central European Property activities.
The product information above is for press release purposes only; full details are contained in the product literature available from Hibernian.
The value of property investments is generally a matter of valuer’s opinion rather than fact. In addition, property investments may not always be readily saleable and very occasionally there may be constraints on cashing in units.
The value of investments abroad may rise and fall due to exchange rate movements.