Underlying earnings improved £62 million* to £134 million
Revenue growth of 9 per cent achieved in each of commercial insurance, home, travel and private medical insurance, with an 11 per cent reduction in motor insurance following actions to improve profitability by changing the mix of the motor book
Current year combined ratio** deteriorated 0.8pts* to 100.2 per cent due to the cost of flooding and storm damage claims
Funds under management on AXA Wealth’s ‘Elevate’ wrap platform rose by 51 per cent to £5.3 billion, bringing total funds under management to £21.6 billion (2011: £18.9 billion)
Commenting on the results, Paul Evans, AXA UK & Ireland Group Chief Executive said:
"The transformation of the competitiveness and profitability of AXA’s businesses in the UK has made substantial progress. Investments in new products and distribution channels, enhanced service to customers and brokers and operational efficiency have resulted in strong revenue growth, across the majority of the portfolio, and improved profitability."
At a time when the wider financial services industry continues to be under incredible scrutiny, the vital social purpose met by insurance companies such as AXA should be in no doubt. During 2012 AXA UK & Ireland:
met the insurance and investment needs for over 13 million customers
dealt with payments of insurance claims totalling £2.4 billion, helping customers go about their lives protected from the day to day risks they have insured with us
supported around 43,000 customers who were impacted by the devastating flooding and storm damage seen across the country last year, including almost 3,500 small businesses
supported nearly 350,000 members of AXA PPP healthcare with access to private healthcare specialists and care at their time of need
helped over 300,000 motorists to get back on the road after being involved in a road traffic accident
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In 2012, general insurance revenues increased by 2 per cent* to £3.8 billion, including a 5 per cent* growth in sales of products through brokers, and 9 per cent* growth in sales of commercial insurance, home, travel and private medical insurance respectively, which account for almost 75 per cent of AXA UK & Ireland revenues.
Motor profitability improved in 2012, thanks to pricing and risk selection actions in the Direct channel, most notably Swiftcover, which together reduced motor revenues by 11 per cent*. The new management team in place in our Direct and Partnership business is already making its mark and will drive improved results in 2013 and beyond.
Overall, the current year combined ratio for general insurance activities increased by 0.8 pts* to 100.2 per cent. This can be attributed to the increased cost of flooding and other storm damage claims during 2012, offsetting underlying improvements elsewhere.
AXA has long endorsed the original spirit of the Financial Services Authority’s Retail Distribution Review (RDR) and has built the AXA Wealth business to provide the best possible products and support to advisers and customers in the new fee-only advice world. During 2012, funds under management on AXA Wealth’s ‘Elevate’ wrap platform rose by 51 per cent to £5.3 billion, bringing total funds under management to £21.6 billion (2011: £18.9 billion). 51 per cent of the company’s investment sales of £3.3 billion were made on the Elevate wrap platform, where sales increased 17 per cent. AXA’s multi-manager fund management business, Architas, increased funds under management by 20 per cent to £11.3 billion.
Paul Evans, continued, "I am very pleased with the progress we have made over the past year. Economic conditions, both here and in Europe, will remain challenging in 2013 and beyond, and we will keep a resolute focus on efficiency and delivery for customers across all areas of our business in order to build on these results."