Good morning, everyone, and thank you for joining our full year 2023 results presentation. I'm delighted to welcome you to our new head office for the very first time. Hope you like it. I'm going to start with a brief update on our full year performance, covering the highlights of today's announcement before Charlotte is going to take you through our results in more detail. Then I'll update you on the strategic progress that we're making, and we'll finish with an opportunity for any questions. So before we do that, I want to set the scene with a broader view of what these results demonstrate: our momentum. Aviva is moving faster than before. We're delivering consistent quarter-on-quarter growth, strong and reliable earnings, and cash generation, and we're exceeding our targets.
The credit for that goes to my Aviva colleagues for everything that they do to support our customers, whether that's helping a family recover from a devastating flood claim, consolidating someone's pension pot to help them plan for retirement, or developing a new service such as our Canadian auto care centers. Our people work tirelessly to help solve our customers' financial puzzles, so a very big thank you to the whole Aviva team. On top of strong performance today, we're also investing for Aviva's future. Our performance, together with these investments, gives us the confidence to upgrade our targets and our dividend guidance today, and to announce our next GBP 300 million share buyback. So why are we so confident? Well, we continue to grow right across the business. In general insurance, premiums are up 13%, and we've had over $8.3 billion of net flows into our wealth business.
We're more efficient. Our costs were down 1% on last year, and that's despite the difficult inflationary environment. We're more profitable, with operating profit up 9% on the prior year, and this has translated into excellent cash remittances of almost GBP 1.9 billion and a strong capital position. So this and the track record that we have worked hard to develop over the last three years shows that the business model that we have built brings resilience and opportunities, and that we are pursuing the right strategy which is centered around our customers. It also reflects our consistent framework for deploying resources and managing performance across the group, and Charlotte will talk more about that in a minute. Executing that strategy has allowed us to deliver precisely what we said we would: strong and reliable momentum on both growth and performance, providing the confidence to invest in our future.
We're already seeing the benefits of our GBP 500 million investment in customer experience, growth, and efficiency. We've grown our UK customer base by more than 470,000 in the past year, and we're on track for the GBP 100 million uplift in operating profit that we are committed to. We've simplified the business, delivering GBP 757 million of gross cost savings since 2018. We're well positioned to accelerate our organic growth through further investment in the business, and we're supplementing this with bolt-on M&A. Our acquisition of the AIG UK protection book will bring more new customers to Aviva. In Canada, Optiom will strengthen our specialty lines business with a growing stream of distribution income. Earlier this week, we announced the acquisition of Probitas, a high-quality, fully integrated platform in the Lloyd's market. This will expand the market opportunity for our global corporate and specialty business. Moving now to group targets.
Over the last three years, Aviva has consistently delivered on its promises, so much so that we have now delivered our cost reduction and our OFG targets one year early, and we're on track to exceed our cash remittance target. So today, we can announce that we are upgrading our group targets to reflect our strong position and confidence in Aviva's future growth. We have a new operating profit target of GBP 2 billion by 2026, reflecting a strong annual growth rate. And we're refreshing Solvency II operating own funds generation and cash remittances with bigger ambitions. Turning now to capital return and the dividend. We're committed to continuing to deliver superior returns to our shareholders, year in, year out. Today, we announced our next GBP 300 million share buyback program, which starts immediately.
With our confidence in Aviva's performance trajectory and the positive outlook for cash generation, we're also upgrading our dividend guidance today. Our track record in this space is rock solid. Over the last three years, we've returned over GBP 9 billion in capital and dividends to shareholders. That's over 70% of our current market cap and a very attractive yield for our shareholders. That's a high-level view. I'm now going to hand over to Charlotte, who will take you through the performance and the upgraded targets in more detail.
Thanks, Amanda, and good morning, everyone. It's fantastic to welcome you to our new office to discuss another set of great results for Aviva. Before I get to the results, I want to share with you some detail about our framework for deploying resources and managing performance across the group.
In the 18 months since I joined Aviva, I've worked hard to refine this framework to ensure both grip and agility. This underpins our confidence in delivering consistent and dependable long-term value creation for Aviva. At its heart are the first two tiles on this slide. First, sustainable growth in earnings and cash. Second, a strong balance sheet. We continually look across our diversified group to optimize how capital and other resources are allocated and reallocated. I'm always working with the businesses to optimize our response to trading opportunities, market conditions, and cost challenges. We've built a strong performance culture that drives the delivery of profitable growth and maintains a really robust balance sheet. The power of the capital generation meets our commitment to grow regular dividends, the third tile. Combined with balance sheet strength, this gives the firepower to execute across the rest of this framework.
The fourth tile is investing in the business to fuel further organic growth in earnings and cash generation at the right hurdle rates. We continually monitor and challenge the delivery of benefits and returns on this investment. We have invested most of the GBP 500 million that was planned for organic growth and efficiency back in 2022, and this is delivering the additional profit goals that we set out. In addition, we continually scan and assess possible inorganic opportunities. Our portfolio is now majority capital light, and we've demonstrated our ability to execute high-quality bolt-on M&A in our COR markets to accelerate this growth. These have been done at attractive valuations to generate strong returns, and we will continue to do this. The final tile is very important. We look to return surplus capital to shareholders.
Today's GBP 300 million share buyback will further reduce the share count, enhancing growth in dividend per share going forward. We continue to anticipate regular and sustainable capital returns in the future. I'll now take you through the 2023 results. I am proud that they demonstrate the strength of our performance culture in applying the framework I've just described, delivering great results from our diversified business model and investing to create long-term value. Starting with our 2023 results at a high level, Aviva's performance has been excellent once again. Growth momentum has continued across the board, particularly as we accelerate the capital light areas. Profits continue to grow year on year. Operating profit was up 9% to almost GBP 1.5 billion, and OFG up 12% to just over GBP 1.7 billion. Costs continue to fall, down another 1% in 2023, which is a fantastic achievement against significant inflationary headwinds.
We've exceeded our GBP 750 million cost target a year earlier than planned. Our capital position remains extremely robust at 207%, and trading trends across the group have been strong. For example, we've achieved double-digit growth in general insurance premiums, and in IWR, Operating Value Added grew 13% to over GBP 1.8 billion. Moving now to the business units in more detail, starting with UK and Ireland general insurance. Premiums were up 16% to GBP 6.6 billion, including both double-digit growth in both personal and commercial lines. Just over half of the personal lines' growth was from rating actions as we continue to rate ahead of inflation. A little under half was from volume, driven by new propositions such as Aviva Zero and High Net Worth.
I'm also pleased with the progress made in growing the retail business in the UK, which has a higher margin and was a feature of the plans discussed at our Personal Lines In Focus session last January. Retail premiums grew 41% in 2023 and now make up 51% of the UK's personal lines premium, up from 45% a year ago. Commercial lines premiums increased by 10%, again split relatively evenly between rate and volume and across both SME and GCS. Our undiscounted COR remains very strong at 96.8%, despite higher reinsurance costs, claim frequency trends, the storms, and the continued inflationary environment. Crucial to this is the grip we have over claims cost management. The underlying current year claims ratio improved in the second half of 2023 as strong rating actions earned through, and we're seeing this trend continue in 2024. On a discounted basis, COR was an impressive 93.6%.
Operating profit was up a superb 63%, supported by the impact of higher yields on the investment result. By now, I'm sure you've seen Monday's exciting announcement that we are acquiring Probitas, a high-quality, fully integrated Lloyd's platform. Entering the Lloyd's market supports our ambition for capital light growth and significantly expands the market opportunities in our global corporate and specialty business. Strategically, the portfolio is extremely well aligned with GCS, both in terms of footprint and business mix. Over half of the business Probitas writes is in the U.K., Ireland, and Canada, and it predominantly underwrites across property, casualty, and financial lines and has no exposure to U.S. domiciled casualty risk. So the deal gives us access to the Lloyd's market to write business lines and geographies that we already have the expertise and appetite to underwrite.
We've already had great feedback from our brokers as this acquisition will enable us to service even more of their customers. Finally, and importantly, the financial returns are really strong, with the transaction expected to deliver high teens IRR. Turning now to Canada, where the picture is similar to the U.K., premiums grew 10%, driven by rating actions and strong new business volumes. The undiscounted combined ratio was a very good 95.3% and exhibited similar trends around reinsurance costs and claims frequency. On a discounted basis, COR was 91.4%. Now, specific to Canada were the impacts of heightened car theft in Ontario, wildfire, and other cat events, particularly in Q3, and the beneficial prior year development sum. Operating profit was up an impressive 18% to GBP 399 million, with improved investment returns. Moving to IWR next, I'll start with the overall performance before getting into the segments in more detail.
We delivered strong top-line growth right across IWR, driven by health, protection, workplace, and annuities, capitalizing on favorable market conditions. At this point, I want to talk about the long-term value creation in IWR. As I'm sure you'll recall, IFRS 17 introduced the concept of the contractual service margin, or CSM, primarily for our annuities and protection businesses. It's a really important measure of long-term value creation. Growth in the CSM leads to a higher stock of future profit and gives greater visibility of the profits to be recognized smoothly over time. A strong retirement performance in 2023 led to growth in the CSM of 12%, exceeding the unwind rate of 9.9%.
Now, building on this, Operating Value Added, which combines the operating profit with the growth in CSM, is the best way to look at IWR's performance under IFRS 17 because it recognizes the value at the time it's generated. So with that in mind, I'm very pleased to report that Operating Value Added was very strong at GBP 1.8 billion, excellent growth of 13%. Importantly, the Operating Value Added is free from the distorting interest rate mismatch effect that can arise in operating profit from assumption changes. Now, these assumption changes, such as longevity, are recognized in the CSM and released to operating profit over the life of the policies. The value of the assumption changes recognized in the CSM is measured at the interest rate that prevailed when the business was originally written.
However, the change in the best estimate liability for the same assumption changes is measured at current rates. The impact of this mismatch in rates is recognized in operating profit immediately. So in a lower interest rate environment, 2022 operating profit benefited from this mismatch by GBP 222 million as opposed to an GBP 82 million negative in 2023. So a GBP 300 million downward swing, which you should look through when assessing our underlying performance. As such, we are pleased with the operating profit of GBP 994 million. Exceeding the impact of the interest rate mismatch on assumption changes, operating profit was up 10%. Finally, leaving IFRS 17 behind and applying the Solvency II lens on performance, OFG for IWR was almost GBP 1.3 billion, up 7%, driven by improved investment returns from higher yields.
Now, I'll unpack the performance of IWR businesses in a little bit more detail, starting with protection and health, where sales grew 16% to GBP 415 million. In health, the demand for private cover continues to rise, fueling a 41% increase in sales. We are investing in this business to support further growth and ensure we deliver high-quality customer service. The cost of this investment, combined with changing customer trends in product usage, have impacted the operating profit this year, but the low 90s COR remains very strong. Protection sales were up 5%, driven by growth in individual protection despite the more subdued mortgage market. Operating profit was impacted by some adverse mortality experience and assumption changes in individual protection. Now, whilst this flows through to negatively affect Operating Value Added, it was largely offset by growth in the CSM from the value of profitable business written. Onto wealth next.
So while the environment remains challenged, the business continues to attract strong flows, which were resilient at 6% of opening AUM. Workplace continued to go from strength to strength with net flows of GBP 6.9 billion, up 19%, supported by new scheme wins and the impact of salary inflation on contributions. In platform, although investment activity remains subdued, we are well placed when appetite returns, with a highly regarded proposition that we continue to invest in. Operating profit of GBP 100 million included GBP 28 million of ongoing investment made to ensure we capture the significant growth opportunity as outlined in our in focus session back in October. In the annuity business, we grew BPA volumes by 24% to GBP 5.5 billion.
Now, we always take a disciplined approach in this market to ensure strong margin and efficient capital strain and by sourcing high-quality assets through our experts in Aviva Investors, who originated GBP 2.6 billion of real assets in 2023. We expect to write healthy volumes again in 2024. Always focused on the capital efficiency of our businesses, it's noteworthy that during 2023, our book of business was self-sustaining in its use of capital. In the higher rate environment, demand picked up for individual annuities, while sales in equity release were lower, reflecting market contraction. Retirement new business margin improved in Q4 as a result of strong trading performance. The full year margin was 4%. We were very pleased that Operating Value Added was up 24% to GBP 1.6 billion.
Operating profit excluding the interest rate mismatch on the assumption changes was up 22%, reflecting releases from the growing stock of future profit, together with improved investment returns. Turning next to costs, I'm delighted to report that we have achieved our GBP 750 million cost program a year earlier than planned. Controllable costs are down 12% from the original 2018 baseline, a fantastic achievement in any period, even more impressive in an inflationary environment. We've seen double-digit reduction in costs across most of the group and achieved this while investing in the business. And although costs in Canada are higher over the period, our Canadian business already had and continues to have market-leading efficiency. The increase in costs there reflects further investment for growth. We remain laser-focused on our costs and continue to seek further operational efficiencies.
With the GBP 750 million cost target delivered early, our ambition now moves to maintaining or achieving top quartile efficiency for the businesses. You'll continue to see the results of our focus on this going forward. That takes me to an important element of today's results as we go further on cost efficiency and customer service in IWR. Earlier this year, we announced 15-year extension agreements with two key existing partners to help further streamline our cost base. With Diligenta, the agreement will reduce the number of legacy platforms. With FNZ, the extension will introduce more heritage products onto their platform. This will bring both efficiency and simplification to the business. Our customers will benefit from an improved proposition and a modern IT platform that will enhance their experience.
We will also achieve further simplification of our IT estate as we consolidate the number of strategic partners and reduce the number of legacy platforms and IT applications. The financial benefits from extending these two partnerships are very attractive. Some important numbers to highlight. Firstly, from a capital perspective, the benefits already locked into the agreements with the partners drive an initial operating OFG benefit of GBP 208 million. Overall, we anticipate the extension agreements will lead to an uplift of over GBP 1 billion of cumulative OFG and more than GBP 700 million in cumulative cash remittance capacity over 10 years. The full extent of the 2023 to 2028 restructuring costs were recognized in 2023 as a non-operating charge.
Now, applying the IFRS lens, we expect an annual operating profit benefit that rises to over GBP 100 million in 10 years' time, with a significant majority of this annual benefit expected to be realized later in the timeframe. And costs to achieve this will be recognized below the line, with GBP 61 million incurred in 2023 and a further GBP 300 million in the next five years, equating to an annual similar average cost. Moving now to the developments in OFG, which was up 12% to GBP 1.7 billion at a headline level. As you can see from the yellow box on this slide, it included the initial benefit of GBP 208 million from the IWR partnership extensions that I've just covered. The underlying growth of 28% to GBP 1.3 billion was driven by strong business growth right across the group.
Management actions, which included longevity assumption changes, were closer to a more typical level of GBP 243 million in 2023. You'll recall that they were particularly elevated in the previous year at GBP 542 million. Therefore, the 2023 run rate OFG was about GBP 1.5 billion, achieving our target of GBP 1.5 billion by 2024 a year earlier. This strong progress in run rate OFG means that today we've extended our target to GBP 1.8 billion by 2026. Turning next to the balance sheet, which remains extremely robust, our Solvency II cover ratio is a very healthy 207% and well placed to withstand market movements. The full solvency movements are shown in the appendix and included a strong 14 points of operating capital generation. Our defensively positioned asset portfolio of GBP 85 billion continues to perform well, and we saw net upgrades over the course of the year.
Our leverage position remains comfortable at 30.7% or 28.9%, excluding the tier two issuance back in November. As you can see from this slide, we have plenty of further opportunities to manage our leverage in line with our preference to be under 30% over time. As Amanda outlined earlier, given the significant progress we've made, we are today announcing upgraded group targets. Following the implementation of IFRS 17, we're introducing a new operating profit target of GBP 2 billion by 2026. As I explained earlier, we are now extending our OFG target to GBP 1.8 billion by 2026. This represents very attractive growth in underlying OFG. Finally, we're extending our cash remittance target to at least GBP 5.8 billion of cumulative remittances over the period 2024 to 2026, as we continue to grow sustainable capital generation from the businesses. In summary, it's been another great year for Aviva.
We have even greater confidence in the business, a growing track record of delivery, and evidence of our ability to deploy resources effectively to optimize trading conditions across our markets and maximizing the long-term value of our diversified business model. With that, I'll hand back to Amanda.
Okay. Thank you very much, Charlotte. So we've heard about the strong delivery last year. Now I want to give you the five reasons why we think Aviva is a great investment. Firstly, we are the UK's leading diversified insurer, with a complementary portfolio growing our capital light businesses. Nobody in this market can replicate that successful model. Secondly, we have a consistent strategy, which is working, with investment identified for the future. Thirdly, we have strong organic growth in all our markets, which was accelerated through selective bolt-on M&A. This is evidenced in the numbers that we're producing, and we're confident that we can sustain that performance. Fourth, we now have a track record of delivery built over the last three and a half years. And fifth, we deliver superior returns for shareholders with growing dividends and regular capital returns. So let me elaborate on each of these points.
I'll start with why our unique model and strategy give us this sustainable competitive advantage. Three and a half years ago, we made a conscious decision to refocus our portfolio on the UK, Ireland, and Canada, where we have the right and, of course, the will to win. Now we have a focused but diversified portfolio. We have market-leading positions across the board, and we're operating at scale. We have an unrivaled growing customer franchise of more than 19 million customers. There is no shortage of growth opportunities in the markets that we play in. And as Charlotte has said, we continue to be rigorous and disciplined in where we invest our capital, looking for the right opportunities, whether organic or inorganic, across our markets. We also have a complementary portfolio, which benefits our customers across all their needs and provides Aviva with resilience and opportunities.
Our general insurance, protection, and health and wealth businesses drive customer acquisition, growth, and higher returns. Retirement and heritage deliver cash generation, underpinning our current and future dividends. And with Mark and the team at Aviva Investors, we have a COR enabler of the growth in our wealth and retirement businesses and our sustainability agenda. We know that our strategy to be the go-to customer brand of choice across insurance, wealth, and retirement is the right one for Aviva. It centers around four strategic priorities of growth, customer, efficiency, and sustainability. And we're making great progress on executing that strategy. It's unlocking the competitive advantage of Aviva's model and creating momentum for the future. And because it's delivering real progress and results, you should not be surprised that it remains completely unchanged. We're often asked about growth opportunities.
But let me tell you, there are no shortage of opportunities out there. To just give you a couple of examples, the wealth market is expected to grow 10% per annum from GBP 1.6 trillion- GBP 4.3 trillion over the next decade, and increasing pressures on the NHS are fueling double-digit growth in health. We also see strong growth opportunities across our GI business and in retirement. Regulatory developments in the UK, such as the solvency reforms and the Mansion House Compact, create further opportunities for us to invest in the UK economy. Turning now to Aviva's growth. As you have seen today, we're growing across the board, accelerating our capital light businesses, where we see higher returns and growth prospects, and changing the mix of our earnings over time.
In wealth, Doug and the team continue to take our business from strength to strength, winning 477 new workplace schemes, delivering double-digit AUM growth on the advisor platform, and expanding our lead generation capability for Succession Wealth. With GBP 170 billion of assets across our wealth businesses, we are now the number one UK wealth player. Across protection and health, we are growing. You'll hear more about our health business at our next In Focus session, which will be in April. In UK and Ireland general insurance, Jason and the team are cementing our number one position with over 40% growth in personal lines retail and continuing commercial lines growth. In Canada, Tracy and the team are growing commercial lines with an 88% Combined Operating Ratio. We're building out our RBC partnership in personal lines. Retirement remains a COR component of our business.
Future growth ambitions come from this. We are delivering disciplined growth across BPAs and individual annuities. Looking next at customer, a crucial enabler of our growth is our unrivaled customer franchise. We have the largest of any U.K. insurer and both similar scale to the U.K.'s leading banks. More customers are coming to Aviva every day, with our U.K. customer numbers growing by more than 470,000 last year. We now have 6.3 million MyAviva users, which is up nearly 2 million since 2020. The range and quality of our products and services generate loyalty and mean our customers want more of what we do for them. Today, over 4.8 million customers in the U.K. have two or more policies with us. That is up 150,000 on last year. Our unparalleled brand, we are the number one for trust consideration and awareness.
That gives me great confidence that we will continue to grow our customer franchise. But we are not complacent. We continue to prioritize delivering the right outcomes for our customers. For example, we pass on all the benefit of interest paid on cash balances on our investment platform, and we do not have early exit charges. Realizing our ambitions will ultimately come down to how we live up to our promise to our customers. So we are investing and innovating to build even deeper relationships with our customers. So it's easy to say, but let me give you a couple of examples of how we're doing that. Since launching Aviva Zero in March 2022, we have sold over 500,000 policies, including more than 150,000 policies bought by Aviva customers. In pension consolidation, we've invested in enhancing digital customer journeys.
We've launched a market-leading AI-driven pensions tracing service with Fabric. This helps our customers to trace their pensions in minutes and puts them in control of their retirement savings. We're already reaping the benefits with flows into workplace up more than 50% year-on-year. As you know from the Wealth In Focus session this year, we are relaunching our Direct Wealth proposition around a clear market gap in hybrid advice. Because we offer insurance, wealth, and retirement, we are uniquely able to look after our customers throughout all of the key moments in their lives, from their first workplace pension with auto enrollment, home insurance on their first property, right through to helping them prepare for and transition into retirement. Aviva is there to meet lifetime customer needs.
As a result, more customers will stay with us for longer, allowing Aviva to grow sustainably and profitably, whatever market challenges we face. We are a go-to brand that our customers can trust to be with them today for a better tomorrow, whatever stage of life they are at. That trust is built on our ability to deliver on the promises that we make. In an increasingly complex and uncertain world, we need to continue to adapt our business to make sure that we can respond to changing customer needs. First and foremost, that means running our business in the most efficient way possible. We have been transforming our operations, delivering more than GBP 30 million in indemnity benefits from motor claimed process improvements alone, and reducing our property footprint by 40%. We continue to leverage our group model, delivering GBP 300 million in cost synergies every year.
We've captured over GBP 4 billion of workplace net flows into Aviva Investors in 2023. We're putting technology and innovation at the core of the business. We're developing enterprise IT capabilities and key strategic partners, and generative AI and data capabilities alongside participation in Microsoft's Copilot early access program. We've transformed the performance of Aviva over the last three years. We have grown quarter-on-quarter, year-on-year. By operating more efficiently, we are turning that into improvements in profitability. Through dividend growth and regular share buybacks, we are sustainably delivering superior returns to our shareholders. With our strong momentum and continued investment in the business, we have real confidence in our ability to extend this track record. Our strategy remains unchanged. We are laser-focused on execution. We are well-positioned to secure future growth with a new set of upgraded group targets.
In summary, it's been another excellent year. We hope you share our confidence in the future of Aviva. Thank you very much for listening. I'm sure you have lots of questions. I'm going to ask Charlotte to join me on stage. We will move to Q&A. Thank you very much.
OK. So conscious that there are other presentations going on this morning, and obviously, we'd like to get you away in time so you can get to those. So if we can just start by limiting to two questions each to begin with, and then we'll go from there. So who do I see? Should we start with Andy? Andy?
Thank you. Thank you very much. Morning, everyone. Andy Sinclair from Bank of America. I was just going to start on Canada, just if you can give me some thoughts on budgeting for 2024, just because there's been a challenging backdrop for the market as a whole and just looking forwards. And just any update you can give us on the reinsurance program, January renewals, if anything's changed, and some color and cost to that. That's my first question. And second, the advice servicing review, I know it's relatively small for you guys, but just a little bit of color with Succession and your own pre-existing advice operations. What color can you give us on CRM systems and advice servicing? What data have you got there? Thank you very much.
OK. Charlotte, do you want to do the first one? I'll do the second one.
Yeah. So I think, look, Canada, as I said in my opening remarks, a strong performance last year, both in commercial lines where we hit the core of 88%. Personal lines, we did experience increased claims frequency, both from a return to pre-COVID levels as well as some exposure to increased theft in motor, predominantly around the Ontario region. And you'll have heard that from some of our peers as well. We saw a little bit of weather. But over the course of the year, it was very much in line with long-term averages. So I think as we go through into 2024, it's important that we keep the rate coming through to tackle that increased frequency and to continue to focus on the theft topic. I think, though, what we've also seen is improved efficiency, focus on claims. And so therefore, I think we see growth.
We see rate earning through. But it is important to keep ahead of those inflationary trends. Commercial lines, again, very, very strong. And I think we're continuing to see growth both from rate and from growth.
On reinsurance?
Sorry. Then on reinsurance, essentially, the big change in reinsurance was 12 months ago. So the 1/1/2023 renewals was a big change. And you'll remember that from the time. Then through the course of 2023, we were rating for as much as that. Obviously, you then have that whole catch-up as the rating for that reinsurance catches up in an earned way. What we experienced with the 2024 renewals was a much more orderly movement. I mean, certainly not a change in capacity or pricing back to pre-pandemic levels, but a much more stable, consistent theme. So the program is really similar. And we've made some minor tweaks to it. But actually, we were incredibly pleased with how that program landed, actually, the pricing coming slightly better than we had anticipated. And you could see that in a little bit of the OFG development. But again, great protection.
It comes really from the long-term relationships that we have with our reinsurance counterparts.
On the question around SJP and the servicing, so the SJP issue charging customers for ongoing advice that has either not been received or cannot be evidenced is not an issue for Succession and Aviva. We are very satisfied that Succession have robust processes in place to document, to monitor where annual planning meetings have taken place. The Succession initial advice fees are competitive. They're regularly assessed through a value-for-money lens. We have not seen any spike in complaints over the last month.
OK. Should we go to Ashik?
Thank you. And good morning, everyone. Just a couple of questions. This is Ashik Musaddi from Morgan Stanley. I mean, your organic growth ambitions look pretty good and pretty straightforward. So I have a couple of questions on the inorganic side. First of all, Probitas. I mean, it's a new entry into the Lloyd's market. Can you give us some color as to what your plans are, which lines of business you will be targeting initially, how much capital you're looking to allocate into that business, et cetera, especially given we are in a hard market on some of the lines and kind of getting into a softer market in quite a few lines as well? And secondly, I mean, UK P&C consolidation looks like it's going to continue.
Any thoughts on your view of any need for consolidation, I mean, taking part into consolidation in the UK, any ambitions to do that? I guess I'm referring to a big speculation recently, which you might be looking at as well. So any thoughts on taking part into UK P&C consolidation would be helpful. Thank you.
OK. I can pick those up, I think. So on Probitas, we were incredibly excited about that deal. We've spoken for the last couple of meetings around entry into the Lloyd's market. And I think with the Probitas acquisition, we have landed on a deal which just is so complementary to Aviva, both in terms of the geography and also in terms of the product mix. And congratulations to Jason, who very much drove that deal with the M&A team. So I think Probitas has a really proven track record, very strong growth over the last number of years. I think the CAGR is about 21%. The profitability is very strong, 82% on average combined operating ratio over the five years. And clearly, you don't buy a business like that to not then give it the opportunity to be able to grow.
And so we did have growth ambitions in Global Corporate & Specialty. This allows us to do that. And why is this important to us is because it gives us access to a distribution that we didn't have before. So clearly, there are many brokers that really prefer to place business via the Lloyd's market. We didn't have access to that distribution. Now is the time for them to deliver on the promises that they've made to us. We've entered into Lloyd's. And now they can deliver that distribution through those markets. And the response from brokers has been incredibly positive this week. So we do have plenty of ambition for that business. We see lots of opportunity. And in terms of capital, Charlotte?
Well, I was just going to pick up on the pricing point. I mean, it's been several years of strong prices across a lot of the areas that Probitas has in its business. And so the risk-adjusted pricing is now really strong. And we don't really assume any further increase. But some of that is still earning through. So I think the pricing is really strong there.
In terms of more general M&A, so look, I think what we've shown today is that our day-to-day focus is on our organic strategy. We will be very thoughtful about M&A. And I think where we have delivered M&A, whether that is Succession, AIG, or Probitas, and also Optiom in Canada, it's been with a very thoughtful lens. It's either been to deliver a gap in our capability. So we didn't have an advice capability. We bought that. We didn't have a Lloyd's capability. We've bought that. Or it gives us capital or customer benefits, as in the AIG protection business. So you will continue to expect us to have a high bar on M&A. And we will be disciplined. And we will drive for quality where we go for M&A. Thank you.
You're coming over to this side of the room, Nasib.
Thanks for taking my question. Nasib Ahmed from UBS. So firstly, on your organic target, you've got some growth in there. Where do you see the growth? You talk about capital light. So specifically on the $2 billion, you're currently at about 55% capital light. Do you expect that to grow to, let's say, 60% or 70%? What do you have in your planning for the $2 billion? And then secondly, on the implementation spend on the FNZ and Diligenta partnership, you've got $300 million in IFRS profit coming below the line. What is driving that? I think it's capitalized in the own funds. But what's driving the ongoing implementation spend in that? And just related to that, is that Consumer Duty related, that you're kind of updating the partnership there as well? Is there any benefit on the heritage book from a Consumer Duty perspective there? Thanks.
OK. So let me start on how we think we've got a pathway to the targets. I mean, as you cited, a lot of the growth has been in the capital light business, which we've been investing in. And we are now at a more majority capital light. We don't put any particular target ratio there. But we are continuing with a higher proportion of capital light business over time. So if I think about what we've invested in and therefore where we see the growth coming from, if I'm in IWR, it's very much the wealth and insurance businesses. If you think about what we said in October in the In Focus session, we've got plans to get to GBP 280 million operating profit. Now, that's by 2027. But we'll be well on the way by 2026.
Then you think about the health and the protection and the growth and the investment that we're driving there, really strong opportunities there. And then in general insurance, we expect the strong momentum to continue, delivering both that top-line growth with continued improvements in underwriting and in the efficiency, so keeping that long-term or medium-term ambition of being sub-94, also, of course, in the higher rate environment supported by investment income. Then I think if you think about things that could drag against that, we've got lower center strategic initiatives coming against that with IFRS 17 and some of the strategic and efficiency programs coming to an end. And then, of course, M&A is a component of that. Probitas is accretive effectively from day one.
So all of those drivers give us the confidence on the route to target, whether you're looking at it from an operating profit perspective or an OFG perspective. And then your second question was on the partnership agreements. I mean, the current and restructuring costs, so the costs we've taken, I mean, there is a certain amount of contractual setup for the new arrangements with the two new partners. There's internal and external resources, IT, to execute the transition. There will be some it's obviously consolidating to two partners. So there'll be some third-party exit costs as we reduce the number of partners' platforms. So those are the things that, as we've modeled out the pathway, those are the things that we're considering. And as you know, in the OFG or the solvency model, once you've kind of planned those out and you know those, those build in your assumptions.
You have to bring those to account at the outset.
OK. Let's come down. Should we go to Rhea next?
Thanks. Rhea Shah, Deutsche Bank. So first question, just on general insurance, where should we expect the undiscounted combined ratio to get? Should we still be pushing through 94% for the 2026 operating profit, the group operating profit target? Is that what's also contributing to it? And then second, just going back to Succession Wealth and Advice, do you charge an ongoing advice fee to your customers? And have you received any letter from the FCA around this? Because I think they did send letters to about 20 different companies or advice companies.
OK. Thank you for those questions. So I'll pick up the second one. And Charlotte can pick up the first. I'll do that first. So on the letter, yes, we did receive the letter. We were one of the 20 firms to receive the letter. But I think that's pretty standard. In terms of do we charge an ongoing advice fee, then we do not. If a client decides to take ongoing advice, then that is set competitively against the market rate. So I think it's very different to what you experience elsewhere.
On GI, we maintain our sub-94 aiming point. It's absolutely there. I think we see it as the right medium-term aiming point. It's really important for keeping the discipline for the underwriters. I think we have to recognize we're in a higher rate environment. Therefore, we're conscious of the balance between underwriting margin, underwriting profit, and overall operating profit. We aim to maximize operating profit, so with disciplined underwriting and then an investment portfolio which remains high quality and relatively modest on its risk. Overall, I would say we're not going to get to sub-94 in 2024 or 2025. Will we be closer to that in 2026? I mean, it really does depend on the interest rate and the broader environment. I think that's how we're looking about it.
I think that if I look at all your models, that's a similar perspective that you have.
OK. Let's come to Andrew next. Then Dom will come to you afterwards, OK?
It's Andrew Crean, Autonomous Research. A couple of questions. Firstly, on the CSM roll forward, if I just take the interest accreted plus the new business contribution minus the release, I think you're down $100 million, which would suggest the CSM, if you didn't have positive experience variances and assumption changes, would actually shrink. So could you give us a sense as to what you expect from experience variances and assumption changes yearly? And then the second question on the inorganic, you've basically spent your Singlife check. So further bolt on, how will you finance that with the solvency margin now coming down more towards your target level? And are you focused on D2C platforms? I noticed you're number one, two, and three in everything. And in D2C, you're number 16 and rising.
Yep. OK. Charlotte, do you want to?
Yeah. So CSM, always good to talk about that. The way I look at it is I think of the new business and the interest accretion and what does that give me? And that's GBP 694. I look at that before I get into assumptions. I look at that versus the release. And I tend to look at the release ex-heritage on the basis that there's nothing new going into the CSM for heritage. So if I take that, it's growing GBP 694 versus GBP 648 is sort of how it grew. So that's before I get into any assumptions. And it's recognizing that the heritage is in runoff. And all the other parts of the portfolio are there to build the operating profit to compensate that as that runs off, that goes away. So that's how I tend to look at the build versus the release.
I think we've seen more build this year again. In terms of experience variances and assumption changes, assumption changes, what I would continue to guide you to is the sort of 200-ish type level. Obviously, longevity this year was a little higher than that. Again, if I look forward to the tables and how I would guide you going forward, I would say that we don't expect the same sort of significant longevity releases going forward. I think of it as put 200 in roughly for that. Then experience variances, they come and go. It varies. Obviously, you get some that go in one direction, protection, versus some of the retirement side. There's a bit of offset there.
But again, if we're modeling and doing our actuarial work well, but still slightly conservative, then in general, I see a little bit of positive experience variance coming through there.
On your second question, Andrew, so I think firstly, if you take the solvency ratio where it is today, clearly you're right. We've got money coming in from Singlife. We've then got money going out for the M&A. We've got money going out for the final dividend and the buyback. I think there is still a little bit of headroom there. But I think the way you've got to look at the business is we are actually generating operating capital as we go through each year. And therefore, we would allow ourselves some flexibility and some headroom to be able to do the type of deals that we've done so far and that we've been talking about this morning. On the D2C platforms, we actually have, you're right. It's the area where we've got the biggest catch-up to go.
But fortunately, it's also the area where we've got the biggest plans to develop. And I don't know whether you've had time to look at to download the new Direct Wealth app, which we sort of launched in stealth at the back end of last year. But we see a real opportunity to relaunch Direct Wealth. So we've done that. There's a definite gap in hybrid advice, which we definitely look to fill. It's early days. But so far, the AUM is up 25%. The number of customers are up 10%. And that's about $300 million net fund flow. And that's from a very soft launch. We've not done anything with that. We've just basically put the app out there. So we believe that there's plenty of opportunity to become a significant player in Direct Wealth. And I think Doug and Michele talked about that.
But our ambitions are very strong that we can do that ourselves using the 1.5 million customers we've got in heritage and also the 4.5 million workplace customers. So we've got plenty of opportunity.
OK. Great. Dom, let's come to you.
Thanks. Dominic O'Mahony, BNP Paribas Exane. First question, just on the targets, which are very welcome. Thank you for them. Can I just check on the scope? Are these already net of the Diligenta FNZ run rate savings? And actually, similar question for the Diligenta savings. Do those run rate savings already embedded in your surplus emergence figures, which you put in the press release?
So the targets are obviously 2026. The time frame for the realization of the benefits on the partnership extensions is really longer than that. So I would see these as the rationale and the sort of pathway to the targets that I covered before from the business is more the driver than those extensions. But to the extent that we're seeing some benefits by 2026, sure. But as I said, it's much more further out that we would really expect those benefits to come through.
Very clear. Are they in the OFG surplus emergence figures that you provide guidance on?
Are they what, sorry?
You have a table that shows the OFG emergence from the life book.
Oh, yeah.
I was just wondering whether if I'm projecting out my OFG, whether I should be adding the figures for the Diligenta savings?
Yeah. For the outer years, yeah.
Yes, exactly.
Yeah.
Sorry. That was an attempt at one question. If I can ask my second. Just on wealth, you're clearly very ambitious there.
Sorry. That emergence that you've got in the book is from the existing business. So it's built on what we have. Yeah. So to the extent there are further benefits to come, they would come later. This is really the emergence from the existing book is the disclosure that you can see.
Got it. Very clear. Thank you. So my second question was just on wealth, clearly an area of big ambition. And Amanda, you were just talking now about your ambitions on the D2C side, which are very exciting. Just in the sort of more near term, I guess coming up towards the tax year end, what are your conversations with advisors like? Is there any sign of a bounce back in, for instance, platform? And is there any more need for investment spend in that platform similar to what you saw in 2023? Thanks.
Yeah. So I mean, taking wealth overall, I think there's been a really resilient net fund flow. I mean, 6% of opening AUM. And as I mentioned, I'll mention it again just for the sake of doubt, $170 billion of assets across the wealth business. Plus, this is the number one player in wealth in the U.K. So where do those opportunities come from? On workplace, we're definitely seeing good continued growth from salary inflation, obviously employer contributions. So very, very strong growth there. And obviously, the new scheme wins. And I think that those flows, which is the very exciting thing about last year, 60% of the net fund flows on workplace are going into Aviva Investors funds. So there's a really good complementarity there.
Now, the advisor platform, I think there was some news this week, which we were rated as number one by Defaqto for the advisor platform. So I think we would take great credit from that. Clearly, the overall environment has been affected by the flows have been affected by the overall environment. But I still think we're a strong number two by flows, just ahead of Transact, but likely behind one other. And I think the platform itself is performing really well. What are we seeing in terms of trends? I think it might be just a little bit too soon to tell. But I think strong, resilient. And we would expect to see some benefit from that. And I've just spoken about Direct Wealth. So I think the complementarity of the sort of advisor, the workplace, and Direct Wealth puts us in a really strong position.
Download the app. It's very good.
28 million was obviously the amount we invested for growth this year. I mean, it's a continuing program. So you will see more investment costs going forward as well. I should also say, by the way, I've forgotten to mention Succession Wealth. Growth flows in Succession Wealth are up 17%, which is driven by quality leads, acquisitions. And we're seeing good opportunities to put those leads, to connect the leads from the Aviva mothership into Succession Wealth. And we see more opportunity in that going forward.
OK. Larissa, we'll come to you next.
Thank you. Larissa van Deventer from Barclays. Two questions, please. The first one, you speak about the balance between capital heavy and capital light. In which areas do you see most scope for margin improvement? And part of the reason why I ask is that your bulk annuity volumes were up, what was it, 20% almost year-on-year. But you speak very positively about growth in other areas. The other one, you've spoken a lot about net fund flows and the additional flows coming in through these bolt-on acquisitions. How should we think about the cost to income ratio and the fees generated in Aviva Investors, please?
OK. So shall I pick up the Aviva Investors point, Charlotte, and you pick up the others? Is that right?
Yeah. That's fine.
So in terms of the cost to income ratio on Aviva Investors, I mean, fortunately, Mark has done a huge amount of work over the last number of years with the outsourcing deals that he's done. And I think all asset managers are clearly struggling at the moment. But Mark was in a fortunate position that he had already anticipated that that might happen, taking a huge amount of cost out. So I think that puts us in a strong position for when, hopefully, the market changes. What Mark has also done is really focus the business on the areas of particular strength. So the real asset origination, you saw the $2.6 billion, which was originated for the Life Company last year. Life Company, I've said it. There you go. It's IWR. Sorry. The IWR business last year and also the benefit from the flows coming from the workplace business.
I think Mark has put the business in the best place. Also, the sustainability underpin is really helpful. We see real opportunities to grow the business particularly in those areas. I think on the capital light, capital heavy point, so we don't have a sort of set ambition of what that percentage should look like. But do we see opportunity for margin improvement? I would say in all areas, yes, because we're constantly looking for how we improve the performance of the business. Charlotte talked about the sort of cost ambitions across the whole of the business. But we also see with the wealth platform, as we increase volumes, then obviously, the operating leverage improves. The partnerships that we've talked about today will all help with that operating leverage and deliver a better customer experience, which in turn will lead to more customers coming to Aviva.
I think we've got a whole range of things there. Charlotte, anything?
Yeah. And then I think if you just take the retirement business in its entirety, but let's talk a little bit more about BPAs, it's a really important part of our portfolio. So while we emphasize the growth in capital light, the retirement business and the BPA business still is really important to us. And so you saw the growth. And we're absolutely out there participating and winning business. So if I look at the margin across retirement, it was 4%. You seem to think it had gone up. But it was 4% versus 4.2% a year ago. So it's stable, if slightly down. We had a really good finish to the year, though. So you may be thinking about the Q4 development, where we saw some really great assets landing, did some good deals. Reinsurance was very solid.
We also did benefit in the second half of the year a little bit from the changes in the risk margin, so the Solvency II rules. So as I look out on that margin into the first part of this year, I think I would caution you to assume that it's just going to continue because some of that risk margin may get competed away. And there's quite a. It's still a competitive market for all the talk about the size of that business. So we're really thoughtful on the deals that we do and making sure that we've got the right assets and the reinsurance protection all the time. But we're absolutely in that market trading. And you'll see good volumes from us.
OK. So we can come over to Mandy.
Morning. Mandeep Jagpal, RBC Capital Markets. Thanks for taking my questions. First one on Solvency coverage ratio, remains comfortably above the top end of your guidance range. In the past, you stated that the volatile interest rate environment meant that you were comfortable remaining there. Just wondering how your thinking has developed on this given the current higher for longer rates outlook. And the second question is on health. Full year sales were up 41%. But I think they were 56% at 9 months. So I just wanted to understand the drivers of that apparent slowdown in Q4.
Yeah. OK. Thank you. So on the coverage ratio, I think I referenced it when I was answering Andrew's question earlier. So whilst we start with 207, and we've always said we'd like to keep at the high end of the range in a high interest rate environment, you've got to remember that we are going to see the final dividend come out of that, the buyback, the deals that we've done. And then, of course, the business will generate capital. So we still think there's a high level of macro uncertainty, although, of course, interest rates higher for longer. So you would expect us to remain at the high end of our range at this time. Also, by the way, we want a bit of flexibility. We want some opportunity. If we see opportunities, we want to be able to take them.
On health, the reason for, I mean, I think 41% is a very solid sales rate. I think the team have done a great job. You may not recall, but in the first quarter of last year, there was a market exit of Cigna. We benefited significantly from that. Therefore, that will have slowed down towards the end of the year. So I think it was much higher in the first half.
Yeah. So it was a lift in the first half, in the first quarter, in the first half rather than a slowdown in the fourth. So I think Q4 was actually flat on Q3, so still very high.
OK. Should we come to Tom down here?
Brilliant. Thank you. Thomas Bateman from Berenberg. Can we just go back to Probitas a little bit? And maybe you could be a little bit more specific on the potential growth outlook. Sounds like you've already got some business lined up. So what are we thinking in terms of both capital allocation and GWP growth for that business in the future? And secondly, just going back to solvency, I think your interest rates sensitivity actually went up to 100 basis points for in interest rates. I just wonder if you could give a little bit more color on why that's happened and if there's any strategic thinking around it. Thank you.
OK. So on Probitas, we're not going to set ourselves a new target in the room today by telling you what the plan for growth is. But clearly, you're not going to buy a business without having strong growth ambitions for that business. The business has grown by 21% CAGR over the last number of years. You then add the Aviva opportunity into that. And therefore, we see plenty of potential to continue to grow that business. But I have to stress, and in general insurance, it's not all about the top line. You also have to focus on the bottom line. And you have to keep discipline. So as the market conditions change, you will see us flex according to those market conditions. We will be very careful about how we allocate capital to that.
But at this point in time, we see plenty of opportunities to grow in the geographies that we like, in the products that we like. It opens up a new distribution. And Jason and the team will be trading very hard on that.
On the sensitivities, you're right. There's a little bit of an uptick in the sensitivities. What we do here is we recognize interest rates are volatile, currently quite volatile. We have an active balance sheet management approach and a strong capital position. And effectively, during the course of 2023, we rebalanced the hedges a little, taking a small amount off given the environment, the strength of the balance sheet, et cetera. That increases the sensitivity a tiny bit. But it's a level we're absolutely comfortable with. And so it's important to bear in mind how we manage the balance sheet. It's on a Solvency II basis. It underpins our capital generation. And we continue to do that. So it's within the tramlines. Again, we keep the IFRS and liquidity in mind while we're executing that.
If I then roll you forward into 2024, we've seen the 10-year rate increase about 50 basis points. The capital generation has been very much in line with the sensitivities. That's really all there is to say.
OK. Should we go to William next? Then Stephen will come to you afterwards, OK?
Hi. Thank you. I'm William Hawkins from KBW. Just the one question, please. Charlotte, coming back, thank you for the color you gave us on BPA. I'm just wondering, strategically, your views about using funded re's to accelerate bulk purchase growth. On the one hand, it could be a great way of doing some capital light business. On the other hand, it comes with complexity. So I'm wondering how funded re's fits into your BPA strategy, please.
I mean, it's a relatively small component of the portfolio. It tends to be relevant for larger deals. We generally do smaller deals. So we consider it. But in overall terms, it's only about 10%. So it's relatively small.
OK. To Stephen next.
Steven Howard from HSBC. Two questions. One's on the management actions that come through the OFG and the OCG and trying to clarify where the sort of Diligenta FNZ uplifts come through in terms of your Solvency II earnings. Can you give us a sort of ongoing yearly run rate going forwards about the management actions here, including or excluding longevity, if possible? That would be very helpful. Secondly, is on the UK non-life retail business, on installment income. Obviously, that's been a topic that was addressed by the FCA recently. I wonder if you can give us an update on the sort of level or range of APR that you're using, how that compares to peers, and whether or not you vary the APR depending on the customer.
If you do vary the APR, does it really matter when, if the policyholder doesn't pay, you can just cancel the policy anyway?
Right. OK. Charlotte, do you want to?
Yeah. So let's talk about the management actions and assumptions. So if you go back to, if you look at slide 22, so the partnership benefits of GBP 208 million, that's one component of it. And then GBP 243 million is the rest, so in total GBP 450 million-ish but made up of those two pieces. So I think it's important to think of that, the partnership piece, distinct because it's a one-time effect. The GBP 243 million then is the rest of the management actions. And I would sort of say you've always got various things going in different directions. But it's around GBP 300 million-ish in terms of longevity and the assumption change that we made at the half year. And then there are various other bits and pieces. I think it's important from a longevity perspective to not expect releases going forward.
As we look at the CMI, the tables that we've adopted, and what we're hearing going forward, we think that we're not going to see equivalent type releases going forward. So therefore, I would, and I think I said it before, really guide you to about 200-ish in terms of overall assumptions, management actions. They are lumpy items. So sometimes it'll be more. Sometimes it'll be less. But again, for your models, I would factor that in.
On APR, so firstly, as you would expect, we provide customers with the choice. They pay annually or they pay monthly. And it is a very valuable option, the paying monthly, for our customers. I think we have to look at this from a customer context, and particularly in motor, which clearly they need their cars to get back and forth to work, et cetera. So 60% of our retail customers choose to pay annually. 40% will pay monthly. Very, very important point to make is that we do not make more money on a customer that pays monthly or one that pays annually. We've regularly reviewed our APRs. We benchmark competitively, if not at the very best end of the range in terms of retail. We have capped the APR at 20%.
Our average APR is 16%, which is about 7%-8% of our customers' premiums, which is significantly less than the 12% of IPT that is paid.
OK. Should we come to Barrie and then to Bingjie afterwards?
Well, good morning. It's Barrie Cornes from Panmure Gordon. I've got a couple as well, please. First one, coming back to Probitas, just interested in the timing of the acquisition given where we are in the underwriting cycle and whether or not it's going to be integrated into your London market operations or kept separate, as it seems to be at the moment. And the other question was on M&A. I just wondered if you could give us a flavor of whether or not you're looking to maybe strengthen existing businesses with bolt-ons or look to go into new areas like you did with Probitas. Thank you.
Yeah. OK. So on the timing, and I assume you're referring to the potential flattening out of commercial lines rating, you don't buy a business for one or two years. So I think when we're looking at Probitas, it's a strategic acquisition that we're buying for the long term. And I think the team have managed to navigate their way through various bits of the market over the last five years extremely well. They're extremely qualified underwriters with a lot of underwriting capability. And we would expect them to be able to navigate that. As I said earlier, it's not just about the top line. It's about the bottom line. And certainly, there would be no pressure to grow uncompetitively. On bolt-on M&A, I think what you've seen is a combination of things that we've done here, Barrie.
So when we bought the AIG protection business, that's 2.5 million additional customers to strengthen the protection business that we have, to put us in a leading market position there. There's good capital synergies, good expense synergies. So that's a sort of addition. And then obviously, with Probitas, with Succession, what we've done is add new capability. So I think that we would allow ourselves the flexibility to be able to judge whether or not it hits one or other of those criteria. But I just go back to what I've always said. M&A has a high bar. And we will do it where it makes sense. It is not a vanity project.
Okay. Let's come to Bingjie. Then I think, in the interest of time, we should close after that.
Thank you. Bingjie Chen from J.P. Morgan. And just one question, please. So can you talk about your general insurance premium growth outlook? And how do you think your pricing can support this? Thank you.
Charlotte, do you want to do that?
Yeah. I can take that. Just let me sorry.
Do you mean UK and Canada, or?
Sorry. I mean like a general, like overall. But if you can split by your markets, that would be great.
OK. So if I start in the UK, inflation was running last year around sort of 10% through both motor and home. We were rating ahead of that. What we're seeing going forward is inflation sort of dropping a little bit down below that but still an inflationary environment. We rated well through the course of last year, both in motor and home. If I look at sort of new business rate by the end of the year, it's sort of 40+, so sort of 45, 47. If I take an average over the year, depending on when the rating went through, it would have been significantly less than that. Obviously, it's all about keeping ahead of those inflationary drivers. We are seeing it sort of come off a bit, as you would expect, with the inflation coming away.
In commercial, a lot of that is index-linked anyway. So it's sort of driving across that. But again, we would expect strong. We've been seeing strong commercial rates. And we're continuing to see that rate strength. There are some lines where we're starting to see some flattening out after a sustained period of hardening. So again, a little bit of slowing there. Then in Canada, similar. Inflation is a bit lower. But the rate, again, has been strong and kept ahead of that.
OK. Do you want to close?
OK. So look, thank you very much. We know you're probably rushing off somewhere else. We are around if there's any further questions. And of course, the IR team are around as well. So thank you very much.