Aviva plc

Aviva reported first-half 2026 operating profit of GBP 1.3 billion, up 24% year over year; operating EPS rose 10%; IFRS return on equity was 20.3%; and cash remittances increased 47% to GBP 1.5 billion. Underlying operating capital generation increased 14% to GBP 812 million. The General Insurance combined ratio improved to 93.3% at group level, while the UK and Ireland combined ratio was 93.4%, and Wealth net flows were GBP 7.6 billion, up 32%. On guidance, management expects the solvency ratio to be in the high 180s by the end of the year, full-year 2026 operating EPS to be around 11%, Direct Line cost synergies to reach GBP 130 million this year, and Health operating profit to be around GBP 90 million for 2026.

Amanda Blanc framed the half as another proof point that Aviva’s diversified model is working, emphasizing strong profitable growth, higher returns, and steady progress toward making 75% of earnings capital-light by end-2028. She repeatedly pointed to Direct Line, Wealth, and AI as the key growth engines, and argued the group has more room to grow beyond 2028 because of its customer base, data, and distribution scale. Her tone was confident and expansive, with a focus on long-term optionality rather than near-term caution.

Charlotte Jones highlighted the main financial metrics: operating profit up 24% to GBP 1.3 billion, operating EPS up 10%, IFRS ROE of 20.3%, cash remittances of GBP 1.5 billion, and operating capital generation of GBP 812 million. She said the solvency ratio finished at 176% after operating capital generation, nonoperating items, debt actions, dividend, and buyback, and expects it to reach the high 180s by year-end, including at least 7 additional points or GBP 350 million from Direct Line capital synergies. She also said the company expects full-year 2026 operating EPS growth of around 11%, Direct Line cost synergies of GBP 130 million this year, and noted that business-as-usual change investment is GBP 450 million annually, with more being allocated to AI on a disciplined, return-threshold basis.

Analysts focused on UK Personal Lines pricing versus claims inflation, the treatment of prior-year development, large losses, international operations, BPA returns, AI guardrails, and wealth growth. Management said motor inflation remains mid-single digits, Aviva is pricing ahead of the market, and home and motor rate discipline is supported by its data and repair network; on PYD, Charlotte said the guidance did not assume specific PYD benefits and explained that risk adjustment and balance-sheet-strength effects partly offset each other. On large losses, management said the impacts in Canada and the UK were idiosyncratic; on international, Aviva said those businesses are managed for value rather than growth; on BPA IRRs, management said the 18% half-year figure is a lifetime IRR with no management actions included; and on AI, they said costs are monitored closely alongside revenue and efficiency benefits. On wealth, management said the path to GBP 280 million operating profit looks visible and that Direct Wealth can continue to grow organically without M&A.