Maurice Tulloch, Aviva’s new chief executive, said that he was “determined to re-energise” the insurance company and that it had a “huge opportunity”.
Mr Tulloch was appointed earlier this week, replacing Mark Wilson who was ousted last October. The company’s share price has lagged other insurers for years as investors have questioned its potential for growth.
Speaking for the first time as Aviva reported its full-year results, Mr Tulloch said: “We have strong foundations but we are only scratching the surface of our full potential.
“At the heart of it, it’s all about insurance fundamentals, delivering excellent customer experience, tackling complexity and injecting a different pace of change into Aviva.”
Aviva said that its earnings per share grew 7 per cent last year, but half of that was down to share buybacks, debt reduction and reserve releases due to changes in life expectancy.
The buybacks might not be repeated. Alongside the results, Aviva announced changes to its capital plans. In future, paying down debt will be the priority.
Sir Adrian Montague, the company’s chairman, said: “We plan to reduce debt by at least £1.5bn by the end of 2022, saving approximately £90m per year in interest expenses.”
The company has also changed its dividend policy. Rather than a firm aim to pay out 55-60 per cent of earnings as dividends, which was the previous policy, Sir Adrian said: “We are moving to a progressive dividend policy, which will see the dividend maintained or grown over time depending on business performance and growth prospects.”
The dividend for 2018 was increased by 9 per cent to 30p per share.
Sir Adrian said that the company had made “steady progress” in 2018 and added: “Under Maurice’s leadership, we are confident that we can make Aviva a better business for the benefit of our customers and our shareholders.”