Morgan Stanley

European Financials Conference

31 March 2011
Disclaimer
Cautionary statements:
This should be read in conjunction with the documents filed by Aviva plc (the “Company” or “Aviva”) with the United States Securities and Exchange
Commission (“SEC”). This announcement contains, and we may make verbal statements containing, “forward-looking statements” with respect to certain
of Aviva’s plans and current goals and expectations relating to future financial condition, performance, results, strategic initiatives and objectives.
Statements containing the words “believes”, “intends”, “expects”, “plans”, “will,” “seeks”, “aims”, “may”, “could”, “outlook”, “estimates” and “anticipates”,
and words of similar meaning, are forward-looking. By their nature, all forward-looking statements involve risk and uncertainty. Accordingly, there are or
will be important factors that could cause actual results to differ materially from those indicated in these statements. Aviva believes factors that could
cause actual results to differ materially from those indicated in forward-looking statements in the presentation include, but are not limited to: the impact of
difficult conditions in the global capital markets and the economy generally; the impact of new government initiatives related to the financial crisis; defaults
and impairments in our bond, mortgage and structured credit portfolios; changes in general economic conditions, including foreign currency exchange
rates, interest rates and other factors that could affect our profitability; the impact of volatility in the equity, capital and credit markets on our profitability
and ability to access capital and credit; risks associated with arrangements with third parties, including joint ventures; inability of reinsurers to meet
obligations or unavailability of reinsurance coverage; a decline in our ratings with Standard & Poor’s, Moody’s, Fitch and A.M. Best; increased competition
in the U.K. and in other countries where we have significant operations; changes to our brands and reputation; changes in assumptions in pricing and
reserving for insurance business (particularly with regard to mortality and morbidity trends, lapse rates and policy renewal rates), longevity and
endowments; a cyclical downturn of the insurance industry; changes in local political, regulatory and economic conditions, business risks and challenges
which may impact demand for our products, our investment portfolio and credit quality of counterparties; the impact of actual experience differing from
estimates on amortisation of deferred acquisition costs and acquired value of in-force business; the impact of recognising an impairment of our goodwill or
intangibles with indefinite lives; changes in valuation methodologies, estimates and assumptions used in the valuation of investment securities; the effect
of various legal proceedings and regulatory investigations; the impact of operational risks; the loss of key personnel; the impact of catastrophic events on
our results; changes in government regulations or tax laws in jurisdictions where we conduct business; funding risks associated with our pension
schemes; the effect of undisclosed liabilities, integration issues and other risks associated with our acquisitions; and the timing impact and other
uncertainties relating to acquisitions and disposals and relating to other future acquisitions, combinations or disposals within relevant industries. For a
more detailed description of these risks, uncertainties and other factors, please see Item 3, “Risk Factors”, and Item 5, “Operating and Financial Review
and Prospects” in Aviva’s Annual Report Form 20-F as filed with the SEC on 24 March 2011. Aviva undertakes no obligation to update the forward
looking statements in this announcement or any other forward-looking statements we may make. Forward-looking statements in this presentation are
current only as of the date on which such statements are made.

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Resilient & diversified with growing earnings

A clear strategy
• Increase focus and depth in 12 countries
• Excelling in Life & GI, driving out composite value
1. A strong customer base, with a growing franchise
2. Tight cost control
3. A strong balance sheet

Delivering against the targets

• At least £1.5 billion operational capital in 2011
• Life IRR of at least 12% with payback of 10 years or less
• 2011 general insurance COR of 97% or better
• Additional cost savings of £200 million and £200 million efficiency gains by 2012

Valuation upside
• Dividend yield of over 5.5%
• Valued at only 8.5x IFRS earnings
• Trading on only 70% of EEV NAV

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 Significant growth in all key performance metrics
IFRS Net operating IFRS Return on Equity
operating profit capital generated
£1.7bn 14.8%
£2,550m
10.9%
26%
£2,022m 70%
£1.0bn

FY09 FY10 FY09 FY10 FY09 FY10

Funds under management Dividend NAV 621p

£402bn
25.5p 454p
£23bn
£379bn
24p 6% 80p
374p EEV

IFRS
IFRS

FY09 FY10 FY09 FY10 FY09 FY10 FY10

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 Strong growth in Life & GI
Life operating profit Life sales (PVNBP) Life IRR

£2,318m £33.4bn 12.5%

2.5
4% 10.0% ppt
23% £32.0bn
£1,887m

FY09 FY10 FY09 FY10 FY09 FY10

GI & Health operating profit GI & Health sales (NWP) GI COR

£1,050m £9.7bn 99%

9% £9.2bn 6% 97%
£960m

FY09 FY10 FY09 FY10 FY09 FY10

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Growing income whilst controlling expenses

£m

Income

Expenses

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 Strong profit growth vs competitors

2010 growth in IFRS operating profit*

66%

26% 24%
22%
17%

12%

7%
5%

Aegon Aviva Prudential ING** Allianz Generali Standard Axa

L&G Zurich RSA
Life

(10%)
(13%)
(18%)
* Year on year growth in operating profit or underlying earnings before tax and minority interests at reported exchange rates
** ING insurance operations only
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A clear strategy
Delivering against the targets

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 Strategy: Increasing focus & depth
in our chosen countries
IFRS operating Gross capital
FY 2010 (£bn) Strategic direction
profit contribution generation

UK 1.4 0.9 Invest and deepen presence

Invest and deepen presence in

Europe 0.9 0.8
priority markets “5 plus 2”

Delta
0.5 0.4* Hold for value
Lloyd

North
0.4 0.6 Focus on growing profits organically
America

Asia
- - Focus on growing franchise value
Pacific

Aviva
0.1 - Continued growth in third party assets
Investors

* Excluding Delta Lloyd longevity reserving of £0.2 billion post tax & MI
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A strong life customer base with a growing franchise

Increased future life cash flows Increasing life IFRS operating profit

£bn
£36bn

£33bn

FY09 FY10

10
 A strong GI customer base with a growing franchise

Rolling 12 month GI & Health net written premiums GI & Health operating profit

£m

£1,050m

£960m 9%

FY09 FY10

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 Growing the franchise
Aviva brand awareness in the UK
70%

63%
60%
55% Direct Line

53%
50%

40% 39%

33%
30% 29% 29% Scottish Widows
27% Prudential
26% More Than

20% 20%
17% Legal & General
16% Standard Lif e
11% 13% Esure
10% 10%

4%
0%
Dec '08 Q1 2009 Q2 2009 Q3 2009 Q4 2009 Q1 2010 Q2 2010 Q3 2010 Q4 2010

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YouGov Brand Index data – a Nationally representative daily sample of over 2000 people
Tight cost control

£m
13% reduction in costs since 2008

£500 million cost savings achieved and more to come

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 A strong balance sheet: asset & liability matching
ensures predictable in-force earnings

Assets and liabilities are well matched

Clear benefits of asset and liability Duration in years (HY 2010)
duration matching at point of sale

• Assets held to maturity

• Limited impact from interest rate

movements

• Limited guarantee risk

• Track record of minimal defaults

£21.0bn £0.8bn £31bn £15.8bn

Shareholder
funds
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 A strong balance sheet: further progress in 2010
with the reduction of the pension scheme deficit

Actions Result (£bn)

Pension scheme accounting basis deficit (£bn)

• Aviva and RAC schemes closed reducing
liabilities 0.3 0.6
• Aviva scheme
1.7
– Long-term funding agreement in place
0.3
– £378 million deficit funding payment
in 2010 0.4

• Updated mortality assumptions favourable

0.2
in the UK with offset in DL
0.5
• Ongoing further ALM improvements and
volatility mitigation strategies underway-
covering longevity, equity, interest rate, Zero

inflation and credit exposure

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Delivering against the targets:
remaining fully focused on financial commitments

Target Track record

£1.7 billion operational capital

Deliver at least £1.5 billion operational
generated in 2010,
capital in 2011
a 70% increase on 2009

Deliver a Life IRR of at least 12% with Life IRR of 12.5% delivered in 2010 with
payback of 10 years or less a payback period averaging 8 years

2011 general insurance COR to be 97%

97% COR delivered in 2010
or better

Additional cost savings of £200 million

Original £500 million target achieved
and a further £200 million efficiency
one year early in 2009
gains by end 2012

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Resilient & diversified with growing earnings

A clear strategy
• Increase focus and depth in 12 countries
• Excelling in Life & GI, driving out composite value
1. A strong customer base, with a growing franchise
2. Tight cost control
3. A strong balance sheet

Delivering against the targets

• At least £1.5 billion operational capital in 2011
• Life IRR of at least 12% with payback of 10 years or less
• 2011 general insurance COR of 97% or better
• Additional cost savings of £200 million and £200 million efficiency gains by 2012

Valuation upside
• Dividend yield of over 5.5%
• Valued at only 8.5x IFRS earnings
• Trading on only 70% of EEV NAV

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