Aviva 2014 Annual Report Download - page 46

Asia
We will strengthen our ability to achieve
growth across the region by developing
our capabilities in digital, analytics and
customer marketing.
Financial performance
Performance in Asia has been
encouraging, with cash remittances up
15% to £23 million and particular
improvement in our key VNB metric.
We achieved a 23% increase in VNB in
2014 to £127 million, driven by growth in
China and Singapore. China’s VNB grew
94% to £31 million driven by a shift
towards higher margin protection
products, and Singapore’s VNB increased
14% to £87 million beneting from the
inclusion of health business in VNB.
Life operating prots reduced by 9%
to £87 million, mainly driven by the
investment in implementing our joint
venture in Indonesia (see below), as well as
the sale of our business in South Korea
and adverse foreign exchange movements.
Operating expenses, 7% lower at £80
million, were stable on a constant currency
basis.
General insurance COR improved to
97.8%, with the prior year impacted by a
one-off increase in reserves in the
Singapore motor book following a change
in the reserving methodology.
Operational highlights
In 2014, we:
• Launched our joint venture with Astra
International in Indonesia in November
• Shifted our product mix, emphasising
value growth over pure volume growth,
and improved distribution mix towards
protable channels
Overview
We have a presence in Greater China
(China, Hong Kong and Taiwan), South
East Asia (Singapore, Indonesia and
Vietnam) and India.
We offer savings, protection, accident
and health insurance to individual and
corporate customers, and in Singapore we
offer motor, home and travel products, as
well as a fund management platform,
Navigator.
We have three million customers
across our markets1. We have leading
insurance operations in Singapore (where
we are ranked fourth2 in life business) and
China (where we are a leading foreign
insurer in seven of the 12 provinces in
which we operate).
Hong Kong, Taiwan, Indonesia and
Vietnam offer us attractive opportunities
for growth.
Across Asia we operate a multi-
distribution strategy which includes
bancassurance, agents, nancial advisers,
telemarketing and a direct sales force. We
are also investing in other channels such as
direct marketing afnity and digital to
differentiate ourselves from competitors.
Strategy
Our strategy is to continue to capitalise on
the signicant potential for growth in our
selected markets. We will do this by
providing an excellent service to customers
through our distribution network,
harnessing the potential of our local
partners’ brands and customer reach.
We will embrace the True Customer
Composite model by delivering Aviva’s
strengths across life, health, general
insurance and asset management.
The outlook for
Aviva Asia is
promising.
By leveraging
our strengths,
the depth of our
partnerships, our
multi-distribution
channels and shared
expertise we can
deliver signicant
growth in Asia.
—
Chris Wei
CEO, Global Life Insurance
and Chairman Asia
1 As at 31 December 2014.
2 LIA statistics, by Individual Life APE.
42 | Aviva plc Annual report and accounts 2014
Market focus continued