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Insurance had a tough year in 2017. Global catastrophe losses and spiralling costs in personal auto across Canada left many big insurers with little to celebrate.
Aviva Canada was among those hit hard. It was one of the poorer performing independent subsidiaries of the insurance giant in 2017, with operating profit dropping from $482.5 million to $82.52 million in just one year. The company also reached a combined operating ratio of 102.2%, up from 93.0% in 2016, which it attributes to “adverse prior year reserve development across auto and property insurance portfolios together with weaker accident year profitability in the auto insurance market.”
Maurice Tulloch, CEO of Aviva International Insurance commented: “I’ve been working in general insurance for more than 20 years, so I can say Aviva Canada’s combined ratio of 102.2% was a disappointing year. But Aviva’s journey in Canada is very much a growth story. If you look at general insurance in a one-year window, you would be crazy. The market had a tough year in 2017 – these things happen. I think as a Group our response to the challenges of 2017 has been appropriate, and we’re confident in getting back to our target core operating range of 94-96%.”
The insurer is far from hiding in the corner and licking its wounds. It has been a dominating presence in the Canadian market for more than 100 years, and currently has approximately 11% of market share. In January, the company announced a shake-up of its executive suite, with Greg Somerville stepping back from his role as president and CEO, to be replaced by Colm Holmes, who left his role as CEO of Aviva UK General Insurance.
“Colm replaces Greg, who has been a great friend of mine for many years and has done a wonderful job running Aviva Canada,” Tulloch told Insurance Business. “Greg has grown our business from $3 billion to £5 billion, and, more importantly, he has encouraged Aviva Canada to champion the customer. He has contributed greatly to transforming Aviva Canada into a leading insurer, which is a legacy he can be tremendously proud of.”
Somerville has passed the Aviva Canada reins to good hands. Holmes headed up Aviva UK General Insurance, the leading general insurer in the UK market and Aviva’s largest general insurance business, since June 2016.
“Colm is a true technician in the business of insurance,” Tulloch said. “He will be very detailed on pricing, risks, exposure and indemnity, and he’ll also keep a close eye on fraud. He has his own unique style, and I’m sure he will continue to make a difference in the market and will continue to build on the amazing work we’ve been doing as an organization.
“Colm’s appointment reflects the quality and depth of the management team across Aviva. I have worked closely with Colm for the last four years – he has a strong track record of delivering sustainable growth and a deep understanding of what customers and brokers need from Aviva. With his credentials, I’m confident Colm will drive Aviva Canada from strength to strength.”
