Aviva Vision

Aviva PLC
17 October 2007




News release


17 October 2007

AVIVA SETS OUT VISION TO UNLOCK VALUE AND DRIVE GROWTH


Aviva plc ('Aviva') is hosting a presentation for investors and analysts today
in New York. Aviva's group chief executive, Andrew Moss, and his executive team
will set out their vision for 'One Aviva, twice the value', focusing on new
growth and efficiency targets designed to unlock value, drive growth and
accelerate the pace of the group's development in an increasingly global market.
  There will also be a presentation on the strategy for the further development
of Aviva's fast-growing US operation, including the announcement of US third
quarter new business sales.


Aviva's new growth and efficiency targets are as follows:

•   UK: to grow long-term savings new business sales at least as fast as the 
    market, while at least maintaining margins, thereby retaining a leadership
    position in its home market

•   Europe: to grow long-term savings new business sales by an average of at 
    least 10% a year to 2010, while growing new business profit at least as fast

•   North America: to double the volume of US life new business sales
    within three years of the acquisition of AmerUs, while maintaining margins

•   Asia Pacific: to grow long-term savings new business sales by an
    average of at least 20% a year to 2010

•   Deliver additional annualised cost savings of  £350m by the end of 2009



Aviva will also measure progress against its growth and efficiency targets by
reference to earnings per share (EPS), which is impacted by operating earnings,
investment returns, taxation and capital changes, hence heightening the focus on
operating efficiency, profitable growth, investment returns and capital
management.

Andrew Moss, Aviva group chief executive, said:  'Our vision of 'One Aviva,
twice the value' puts a clear internal focus on growth and efficiency and
signals a period of transformation at Aviva.  Today, we've announced ambitious
targets designed to unlock further value and drive growth from our existing
businesses.  Our scale and international reach means that we can now move from
organising the company as a series of independent operations to managing Aviva
as one group; drawing upon not only our size but also our collective knowledge
base and resources to accelerate the pace of growth in changing global markets.
This programme, together with the more effective deployment of capital and
resources and further investment in future growth through new markets and new
distribution, will provide real added value to our shareholders over the coming
years.'



GROWTH TARGETS FOR LONG-TERM SAVINGS

In line with its new regional structure, Aviva has announced new growth targets
for its life businesses.

UK: Aviva is a leader in the UK long-term savings market, with a top three
position in the savings, protection, pensions and annuity markets and
multi-channel distribution. The company plans to grow long-term savings new
business sales at least as fast as the market, subject to a continued focus on
driving overall profitability. This will be achieved through its competitive
product range, strong distribution and building on improvements already made in
customer and distributor service.  Consistent with the 'One Aviva, twice the
value' agenda, the UK Life business is already transforming its business model
to simplify its legacy systems and lower unit costs.

Europe: Aviva is a leading life and pensions provider in Europe.  The company
plans to grow long-term savings new business sales in the region by an average
of at least 10% a year to 2010, while growing new business profit at least as
fast.  This will be achieved by growing bancassurance and other distribution
channels, leveraging Aviva's significant scale in the region to create
efficiencies and using the experience gained in its mature businesses of Europe
to generate superior performance in the higher growth markets of central and
eastern Europe.

North America: Aviva acquired AmerUs in November 2006, making Aviva the number
one provider in the US indexed life market and the second largest in the indexed
annuity market.  The US business accounted for 9% of the group's long-term
savings sales in the half year to the end of June 2007. Aviva aims to double the
volume of US life new business sales within three years of the acquisition of
AmerUs, while maintaining margins.  This will be achieved by an acceleration of
sales following the recent financial strength rating upgrade by A.M. Best, an
expansion of the product range, and further development of its distribution
network.  Aviva also announces today that its integration of AmerUs into Aviva
USA is now complete, achieving in full the £23m ($45m) integration cost savings.
The combined operation is already trading under the Aviva brand.

Asia Pacific: Aviva aims to grow long-term savings new business sales by an
average of at least 20% a year to 2010. This will be achieved by aggressively
growing the existing businesses in the region, in particular the high growth
markets of India and China, while assessing the potential of new markets and
maximising the use of shared services and knowledge across the region.




OTHER TARGETS REAFFIRMED

Aviva confirmed its existing targets as follows:

General insurance: Target to meet or beat a combined operating ratio of 98%.  As
previously announced, the company retains some degree of uncertainty in
achieving this for the 2007 full year following the £400m exceptional UK weather
losses reported to date.

Dividend: Target to grow the dividend using dividend cover in the range of 1.5
to 2.0 times operating earnings after tax on an IFRS basis, while retaining
sufficient capital to support future business growth.

Return on Capital Employed (ROCE): The current target for return on capital
employed is 12.5% calculated on a basis of smoothed investment returns. Aviva
expects to replace this with a new return on economic capital measure and
targets by the end of 2008.



NEW EFFICIENCY SAVINGS

Aviva plans to deliver £350m of new annualised cost savings over the next two
years, measured at forecast 2007 expense levels. Of these, £300m is targeted to
come from the UK and £50m from Europe. Aviva is developing detailed plans for
the delivery of these savings and further financial information will be
available with the full year results in February 2008. The total initial costs
of delivering these savings will not exceed £350m.



UK

In the UK, Aviva has a market leading position and has already announced plans
to transform its business model to retain its competitive position in both life
and general insurance.   By simplifying processes and maximising scale, Aviva
will deliver further profitable growth and customer service benefits.


•   UK General Insurance: Aviva aims to deliver £200m of cost savings by
the end of 2008 from the completion of a number of change programmes (eg moving
to a single insurance IT platform for personal lines), focused IT spend and a
single approach to marketing activity.  The savings announced today are
projected to decrease the expense ratio to 12.4% in 2008 from 13.9% in 2006.
Looking ahead, the business also plans to simplify structures further and
re-engineer its processes.


•   UK Life: Aviva aims to deliver £100m of cost savings by the end of
2009 by continuing to simplify its legacy systems and business processes. The
partnership with Swiss Re to outsource the administration of almost three
million life and pension policies, which started on 1 October, is a key catalyst
for enabling further simplification of infrastructure and processes in the UK
Life business.  The cost savings will eliminate the expenses overrun in the UK
Life business in 2009.

These savings are in addition to Aviva's previously announced efficiency review
to save £250m per year in its UK businesses from 2008 for an initial investment
of £250m, which is on track for completion by the end of this year.  It is also
in addition to the delivery of £130m savings from the integration of RAC, which
is now complete.


Europe

In Europe, Aviva is aiming to deliver £50m of cost savings from its more mature
businesses by the end of 2009, in particular the Netherlands and Ireland, by
maximising the benefits of scale while delivering further growth.



AVIVA USA NEW BUSINESS FIGURES

Aviva announces today another excellent sales performance for its US business
for the nine months to 30 September 2007. Total new business sales were up 41%
on a pro forma basis, increasing to £2,705m ($5,384m) (2006: £2,103m; $3,828m).
New business contribution increased by 41% to £102m ($191m) on a pro forma
basis.  New business margin improved to 3.5% (2006: 2.2%).



                                    - ends -


Enquiries:

Analysts
Charles Barrows, investor relations director               [phone]
Amanda Wilbraham, senior manager, investor relations       [phone]


Media (UK)
Hayley Stimpson, director of external affairs              [phone]
Vanessa Rhodes, group media relations manager              [phone]
Ed Simpkins, Finsbury                                      [phone]



Media (US)

Andy Merrill, Finsbury                                     [phone]


Notes to editors:

•  Sales targets are life and pensions PVNBP plus investment sales as
published, gross of minorities. New business profit is new business contribution
after cost of capital, tax and minorities. Margins are a rati           o of new
business contribution over PVNBP.


•  Presentation: A presentation to investors and analysts will take place
at 13:30 (BST) in New York. The presentation slides will be available on the
Group's website, www.aviva.com from 13:00 (BST). The presentation is being
filmed for live webcast and can be viewed live on the Group's website or on
www.cantos.com. In addition a replay will be available on these websites later
today.

•  Aviva is the leading provider of life and pensions to Europe
(including the UK) with substantial positions in other markets around the world,
making it the world's fifth largest insurance group based on gross worldwide
premiums at 31 December 2006.

•  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.

•  The Aviva media centre at www.aviva.com/media includes images, company
and product information and a news release archive.

•  This document may include 'forward-looking statements' with respect to
certain of Aviva's plans and its current goals and expectations relating to its
future financial condition, performance and results.  These forward-looking
statements sometimes use words such as 'anticipate', 'target', 'expect', '
estimate', 'intend', 'plan', 'goal', 'believe' or other words of similar
meaning. By their nature, all forward-looking statements involve risk and
uncertainty because they relate to future events and circumstances which may be
beyond Aviva's control, including, among other things, UK domestic and global
economic and business conditions, market-related risks such as fluctuations in
interest rates and exchange rates, the policies and actions of regulatory
authorities, the impact of competition, the possible effects of inflation or
deflation, the timing impact and other uncertainties relating to acquisitions by
the Aviva Group and relating to other future acquisitions or combinations within
relevant industries, the impact of tax and other legislation and regulations in
the jurisdictions in which Aviva and its affiliates operate, as well as the
other risks and uncertainties set forth in our 2006 Annual Report to
Shareholders.  As a result, Aviva's actual future financial condition,
performance and results may differ materially from the plans, goals and
expectations set forth in Aviva's forward-looking statements, and persons
receiving this presentation should not place undue reliance on forward-looking
statements. Aviva undertakes no obligation to update the forward-looking
statements made in this document or any other forward-looking statements we may
make. Forward-looking statements made in this document are current only as of
the date on which such statements are made.  Nothing in this announcement,
including in particular the growth targets, should be construed as a forecast of
Aviva's future profits or be interpreted to mean that Aviva's future revenue,
profits or earnings per share will necessarily exceed or match those for any
previous period.




                      This information is provided by RNS
            The company news service from the London Stock Exchange