© Aviva plcSlide 112
Invested in Potential and Created Value• 5 acquisitions from
Aseval (June 2000) toCaja Granada(September 2002)
• Total Aviva investment of £505m
• Combined market share purchased 3.4%
• Profitable growth of JVs, to market share of Aviva bancassurance of 9.2% of the total life market at end 2003
0.0%
2.5%
5.0%
7.5%
10.0%
Aseval Bia Galicia Unicorp Vida Caja España Total AvivaBancassurance
Growth in Market Share Since Acquisition
Mar
ket S
hare
by
Prem
ium
Inco
me
1. Unicorp figures include Caja Granada
© Aviva plcSlide 113
APE up 18% in 2003(1)
New business sales (APE) in Aviva SpainManaging a Profitable Product Mix
2002 Full Year € 301m
Source: Aviva
Life & Savings64%
Life Risk9%
Pension27%
Life & Savings50%
Pension36%
Life Risk14%
2003 Full Year € 356m
(1) APE for 2003 £ 246 m
© Aviva plcSlide 114
MARKET SHARE EVOLUTION
3.5%
6.9% 7.4%
10.0%
0%
2%
4%
6%
8%
10%
12%
2000 2001 2002 2003
RANKING POSITION
2000 2001 2002 2003
1º
4º5º
6º
Source: ICEA
Premium Income
Market Leader in Spain in 3 years(1)
(1) 10% market share by premium income: 9.2% for bancassurance and 0.8% for Aviva Vida y Pensiones
Aviva No 1 in Life Business
© Aviva plcSlide 115
Unique Business Model Designed for Growth• Trusted partners with strong franchises• Partners incentivised for value growth• One-factory business model• Proven and successful bancassurance process• Management expertise to develop the business• Aviva brings ownership, controls and insurance
expertise
© Aviva plcSlide 117
• 11.1m customers• 12.6% of clients have policies• Less than 1.5 policies per client
• 3,713 Branches• 20% growth next 5 years • Growing in new regions
• Ageing Population• Low Insurance Penetration• Strong growth forecast
Client Penetration
Branch Network
Market Growth
Drivers of Growth are Positive
Plan to Exceed Market Growth
© Aviva plcSlide 118
Total Life Policies/Total Bank Clients
0.00%
10.00%
20.00%
30.00%
40.00%
2000 2001 2002 2003
Further Potential For Growth
Aseval
Caja Espana
Caja Granada
Bia Galicia
Unicorp Vida
Penetration Increase of over 30% in 2 years
© Aviva plcSlide 119
Growing Network with Internal Competition
00.5
11.5
22.5
33.5
44.5
A B C D E
Targets based on Best Practice Performance by Aviva PartnersPensions Business
Protection Business Savings Business
APE
Per
Ban
k C
lient
€
APE
Per
Ban
k C
lient
€
APE
Per
Ban
k C
lient
€
Actual
Potential
Bank
Bank Bank
0
2
4
6
8
10
12
14
16
A B C D E
05
101520253035404550
A B C D E
© Aviva plcSlide 120
Target – A bigger share of a bigger market
Business Development in Action
• Aligning strategy and plans between partners• Tailored training programs at partners and
branch level• Integration with bank product range• Leveraging best practice across the Aviva
network• Expanded Product Offering - Addressing the
clients’ needs
© Aviva plcSlide 122
Shareholder Value – Overview
020406080
100120140160
2000 2001 2002 2003
• High margin products• Average Gross NB Margin
59% for 2003• NB IRR post tax and cost of
SM(1) 30% for 2003• NBC post tax post cost of SM
£78m• After allowing for goodwill and
expected earn-out payments deal IRRs become circa 12%
Bancassurance: new business contribution pre-tax and cost of capital (100% Level)
£m
(1) Solvency Margin
© Aviva plcSlide 123
(1)Aseval provides third party administration (TPA) services for other JVs
AvivaSpain
50% ProfitsBank Partners
BancajaTPA (1)
50% Profits
ServicesFees
50% Profits
Commissions
PremiumsBenefits
50% Profits
Customer
JV Companies
One Factory Bancassurance Business Model
© Aviva plcSlide 124
Spanish bancassurance protection is inherently more profitable than traditional protection business...
• Pricing: less competitive pressure
• Loyal client base• Low expenses in Spanish
bancassurance• Revenue based commission in
Spain
-200%
-150%
-100%
-50%
0%
50%
100%
1 2 3 4 5 6 7 8 9 10
0%
10%
20%
30%
40%
50%
1 2 3 4 5 6 7 8 9 10
...which leads to lower strain and significantly higher margins
Traditional UK protection product cashflow
Spanish bancassurance protection product cashflow
years
years
% o
f APE
% o
f APE
© Aviva plcSlide 125
Illustrative Bancassurance Profit Signatures
• Tax efficient product• Level loading meeting customer needs• Max industry charge 2% pa, typical JV
charge 1.5%• Long duration and high retention• High margin, breakeven year 3
• Competition with bank deposit accounts• Tax advantages if held for 5 years• Higher lapses as also used for shorter
term savings• Level commissions and low costs• Lower margin but high IRR
0.0%
0.1%
0.2%
0.3%
0.4%
0.5%
0.6%
1 2 3 4 5 6 7 8 9 10
Pensions – Single Premium Savings- Single Premium
-1.5%
-1.0%
-0.5%
0.0%
0.5%
1.0%
1.5%
1 2 3 4 5 6 7 8 9 10% o
f Pre
miu
m
% o
f Pre
miu
m
© Aviva plcSlide 126
Illustration
% o
f Fun
d
Initial Expenses - Yr1 OnlyBank Commissions - Yr1 onlyAdmin Expenses
Year 1
2.00%
1.00%
0.00%
-1.00%
-2.00%
i
Annual Charge - Expenses = Profit
Expenses
Annual Charge - Expenses = Profit
Year 2+
Shareholder income and expenses: unit-linked pension contract
© Aviva plcSlide 127
Source: ICEA
0
1
2
3
4
5
6
Aseval Avivabancassurance
cons.
Other largebancassurers
Total Spanish lifemarket
Acquisition and administration costs (% of premium, 2003)
1.55%
3.04%
6.45%
2.20%
%
Increased competitive advantage against the market
Continued Low Costs Underpin Attractive Margins
© Aviva plcSlide 128
Strong Margins Supported by Pricing –Low Expenses and Scale Advantages
Source: Annual reports
No indication of margin pressures
(1) Average 30% Post COC & tax
0. 0%
20. 0%
40. 0%
60. 0%
80. 0%
100. 0%
Q4 2000
Q22001
Q42001
Q22002
Q42002
Q22003
Q42003
Average margin55%(1)
Q1 ’04 margin60%
Bancassurance Gross Margins
Increased weighting of protection
High volumes of savings
© Aviva plcSlide 129
Growing Shareholder Value
• Active management of product mix• Focus on growing the value of NBC• Commission agreements reduce need for capital support• Growing economies of scale from single admin. platform• Cash generating model with low capital requirements
Blueprint for continued success
© Aviva plcSlide 130
Aviva Spain summary
• Spain’s leading life business in 3 years– Strong growth prospects– Attractive product pricing– Expense advantage– Strong margins
• Shareholder value visible at early stages of business development
© Aviva plcSlide 131
Company
GRUPO AVIVAMAPFRE/CAJA MADRIDCAIFORBBVA SEGUROSGENERALIBANSABADELL VIDAIBERCAJAASCAT VIDAALLIANZCASER
Source: ICEA
Aviva No 1 in Life Business
PremiumsMillion €
1.7671.7121.5961.2371.184740718704611529
Ranking
2003
123456789
10
Position
2002
431578
11121410
Appendix 1
© Aviva plcSlide 132
Caixa Galicia
5%
Caja España
6%
Bancaja
17%
4%
2%
10%2%
Unicaja
13%
2%
4%CajaGranada
2% 6%2%
1%
3%19%
Source: INE
Aviva’s bancassurance network has leading market shares in territories that account or c.70% of Spanish GDP• Strong multi-regional
presence in fastest growing regions in Spain
• Growing presence in attractive areas outside home regions (Madrid, Catalunya)
• 11.1 million customers, 3,713 branches
• 3rd largest bank network
Key: %s show proportion of GDP
Appendix 2
© Aviva plcSlide 133
Business Aviva’s EV Currentcommenced consideration(1) acquired customers Region
Bancaja Aug 2000 £217m £47m 2.5 m Valencia
Unicaja Oct 2001 £95m £14m 3.4 m Andalusia
Caixa Galicia Oct 2001 £93m £6m 2.0 m Galicia
Caja España Jan 2002 £88m £12m 1.5 m Castilla y Leon
Caja de Granada May 2003 £12m 0 1.7 m Andalusia
(1) Future consideration subject to performance
Source: Aviva
Spanish bancassurance partnerships at a glance
£505m £79m
Appendix 3
© Aviva plcSlide 134
0
50
100
150
200
250
300
1997 1998 1999 2000 2001 2002 2003
New business sales (APE)
Firstbancassurancedeal
Average compound growth 163% p.a. 2000 (£ 57m) – 2003 (£ 246m)
£mAPE
Transforming Aviva’s Position in the Spanish Market
Source: Aviva
Appendix 4
© Aviva plcSlide 135
Positive “Cash-Flow” From Early Stages of Growth Business
0
5
10
15
20
25
30
35
40
45
50
55
00 01 02 03
Bancassurance pre-tax MSSB evolution
Source: Aviva
£m
7
16
29
50
FY
HY
FY
FY
HYHY
FY
Appendix 5