Aviva shares bucked the market as it unveiled a 25 per cent rise in the value of new business to £823million in the first nine months of 2015 following this year's acquisition of Friends Life.
Life and general insurer Aviva bought Friends Life in a £5.6 billion deal in April, creating a market leader in life insurance.
"The financial and strategic benefits of this deal are coming through loud and clear," chief executive Mark Wilson said. “The acquisition has proven to be everything we expected it to be.”
The company's combined operating ratio, a key measure of performance in its general insurance business, strengthened by 1.9 points to 94 percent (below 100 is in profit).
JP Morgan analysts called the results “a reassuring set of numbers”, reiterating their "overweight" rating on the stock.
Aviva shares rose to a two-month high before trimming gains in a falling market.
The group said it had achieved cost savings of £91m so far from the Friends Life merger, against a target of £225m.
Mr Wilson said the merger had produced capital savings of £300m this year, with “a whole lot more” expected in the next two years.
He reiterated that the group planned to make small bolt-on acquisitions across its global businesses, but said deal sizes would not total more than a few hundred million pounds.
“We are maintaining the momentum of Aviva's transformation with a further quarter of improved performance,” Mr Wilson said.
“ In life insurance, value of new business was up 25per cent, the eleventh consecutive quarter of growth. The general insurance combined ratio...is a more than adequate result. This level of consistency is important as we transform and grow Aviva.”
He said the existing UK life business was continuing to grow and customers were “responding positively to the full range of pensions freedoms we offer”. New business value in the division was up 36 per cent to £404m, and up 13 per cent excluding Friends Life.
Life business was up 11 per cent in Europe to £284m partly thanks to a 55per cent rise in Italy to £57m, and up 21 per cent in Asia to £115m.
Aviva platforms added £2.2bn of assets in the nine–month period taking the total to £7.3bn.
Mr Wilson went on: “In asset management, our flagship fund range AIMS continues its strong investment performance and the Target Return Fund has recorded returns of 6.6per cent over the past 12 months. AIMS now has £1.9 billion of funds under management. We expect this growth to continue.”
The economic capital surplus slipped from £10.8bn at the half-year to £10.1bn in a quarter of market volatility.
The group said: “Work continues to transform Aviva into a leading digital insurer and we will open our second Digital Garage in Singapore in December. We are seeing encouraging growth in the volume of customer interactions that are completed online, albeit from a low base.”
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