Aviva (LSE:AV.) delivered a confident third-quarter update, raising its financial ambitions after reporting broad-based momentum and early gains from its acquisition of Direct Line. The insurer said it now expects to meet its 2026 objectives in 2025—one year ahead of schedule.
Despite the upbeat message, the stock fell more than 4% in early London trading.
The company introduced upgraded medium-term goals, including average annual operating EPS growth of 11% between 2025 and 2028. It also aims to push its IFRS return on equity above 20% by 2028 and generate over £7 billion in cash remittances during the 2026–2028 period.
“Over the last five years we have transformed Aviva, delivering again and again for our customers and shareholders. We continue to make excellent progress and now expect to achieve our financial targets in 2025, one year early,” said Amanda Blanc, CEO of Aviva.
Aviva noted that the integration of Direct Line is moving ahead faster than anticipated. The group raised its cost-synergy target to £225 million—almost double the original figure—and expects more than £500 million in capital synergies after regulatory approval is secured.
Management also reiterated that share buybacks will resume next year, with a larger programme planned due to the increased share count.
Aviva expects operating profit of roughly £2.2 billion for 2025 and said solvency remains strong, ending Q3 with a shareholder cover ratio of 177%. Blanc added that the company’s outlook has “never been better,” pointing to accelerating growth, rising returns, and a plan for more than 75% of its business mix to be capital-light by 2028.
The general insurance division remained a standout performer, with premiums rising 12% to £10 billion in the first nine months. Growth included a 17% jump in the U.K. and Ireland and steady improvements in Canada.
The combined operating ratio improved to 94.4% on an undiscounted basis thanks to stronger pricing and reduced weather-related losses. In wealth, Aviva recorded £8.3 billion in net flows, taking assets to £224 billion, while retirement sales held firm despite difficult comparisons.
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