Insurance group Aviva has decommissioned 100 legacy systems as part of the One Aviva cost-cutting programme.
The company, which trades under the Norwich Union brand in the UK, highlighted teh consolidation as it made its results announcement.
Last year Aviva signed an outsourcing deal with Swiss Re, whereby the reinsurer would administrate three million life and pensions policies on its behalf.
As a result of the agreement, Aviva aims to decommission 330 systems from the 550 originally running. 100 of those 330 systems have been switched off so far.
In a statement today, Aviva explained: “In March 2007, we announced a partnership with Swiss Re to outsource the administration of almost three million policies, enabling us to reduce our 550 product systems to 220. To support this we successfully transferred 1,000 employees to Swiss Re in October.
“This initiative combined with other simplification activity has already allowed us to decommission over 100 systems,” it continued. The first phase of policy migration is due for completion in March, with all policies migrated by early 2009.
Under the overall One Aviva cost savings programme, the group is aiming to save £350m by the end of 2009, through switching off legacy systems and exploiting synergies between existing systems, as well as implementing a more effective business model overall. The cost reduction programme itself is due to cost £330m. Group-wide costs were reduced by 6.5% in the year.
Aviva said it remained “committed to delivering improvements in efficiency and service levels, addressing complex legacy systems and developing simpler customer propositions making us easy to do business with.” It said it had also managed to exploit synergies between systems within the marketing, human resources and IT departments, as well as saving costs through running its own offshoring operation.
The announcements came as Aviva said operating profits for the year to 31 December had clambered 1% higher to £3.3bn on the back of £49bn revenues. Chief executive Andrew Moss extended the One Aviva target, to double earnings per share by 2012 from the 49 pence in 2007, while keeping cost savings targets the same.
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