In the wake of the Covid-19 pandemic UK insurers have seen their shares plummet, with Aviva falling 50% to a low of 211p on 21 March.
Since then, the stock has recovered some of those losses, climbing as much as 31% last week, spurred higher by government stimulus packages aimed at limiting the economic impact of the virus.
However, the company saw its shares close 3% lower on Friday as investors opted to take profits from the market, with the stock trading 2% lower on Monday.
Aviva is trading at 263p a share as of 14:45 (GMT).
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FCA warns insurers to be fair to customers
The UK Financial Conduct Authority (FCA) has warned general insurers to be fair to customers amid the coronavirus pandemic.
The FCA warned the industry that customers’ ability to claim should not be impacted by changing circumstances brought about by the virus, such as having to work from home.
‘Customer behaviour is changing,’ FCA interim CEO Christopher Woolard said. ‘We expect insurance firms to recognise this and treat their customers fairly, recognising the circumstances customers may find themselves in.’
‘We would not expect to see a customer’s ability to claim affected by circumstances over which they have little control,’ he added.
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Aviva admits its ‘too early’ to forecast impact of Covid-19
Aviva has said that it is still ‘too early’ to estimate the impact the virus will have on its business and the wider insurance industry but has tried to reassure investors of the resilience of its balance sheet.
Earlier this month, the company told investors that it remains ‘well capitalised’, with its boasting a solvency ratio of 175% even after factoring in its payment for its proposed annual dividend.
‘It remains too early to quantify the potential impact on our financial performance arising from COVID-19,’Aviva said in a statement earlier this month.
‘The effect on our financial results will depend on a range of factors, including the extent and duration of the period of disruption and the impact on the global economy.’
‘At this point, we remain focused on supporting our customers and colleagues while maintaining our financial and operational resilience,’ the company added.