BACK OUR FUTURE SUCCESS SAVE AS YOU EARN 2017 Documents/Aviva... · You can simply withdraw your cash savings and you will not have lost a penny. If you did buy shares at the Option

SAVE AS YOU EARN 2017BACK OUR FUTURE SUCCESS

Dear Colleague

It’s that time of year again. Your annual chance to join our Save as You Earn (Aviva SAYE) Plan and I want to encourage all of you to seize the moment!

As you know, Aviva has come a long way in the last few years. More importantly I believe we have exciting times ahead. We have strong foundations in place and we are doing some ground-breaking work in digital to really disrupt the way the whole industry works.

We are in good shape and I want all of you to think hard about joining me as owners of this great business.

The plan gives everyone a low risk way to save, and the chance to get more reward from the hard work you are putting in for our customers. You can choose to save up to £500 every month over a period of three and/or five years and then you will be able to buy shares at a fixed price, discounted at the start of the contract period. And if you choose not to buy your shares, you get your money back. In my mind, it’s a total no-brainer!

The fact is that we will only achieve our full potential over the months and years ahead because of you and your hard work. This plan is a great way to back your efforts and share in our success as we grow the company together.

Thank you for your dedication, professionalism and commitment, and I encourage you to take up this opportunity to join me as a shareholder. Don’t miss out.

Yours sincerely

Mark WilsonGroup Chief Executive Officer

Message from Mark Wilson

Welcome | Features & Benefits | How it works | Our colleagues | Calculator | Our Share price | How to join | Q&As | Key Dates | MSP vs. SAYE | Contact

Features & Benefits

Key Details

• Save a fixed amount between £5 and £500 per month for 3 and/or 5 years

• Savings are deducted from your take home pay; i.e. after Income Tax and National Insurance Contributions (NICs)

• At the end of your chosen saving period (Maturity), you can choose to buy Aviva shares at a discounted price, fixed at the start of the plan, known as the Option Price

Key Benefits

• It’s an easy way to save every month

• You get a 20% discount on the price of Aviva shares (at the time of invitation)

• It’s low-risk. If at the end of your chosen saving period, the Aviva share price is:

> higher than the Option Price – you can buy Aviva shares at the Option Price and then sell or hold them and become an Aviva shareholder

> lower than the Option Price – you can simply have the money you have saved returned to you

AV I VA S A V E AS YOU E A R N2017


How it Works

Step 1 - Choose how much to save:

£5-£500 per month for 3 and/or 5 years• These savings are taken directly from your pay, after Income Tax and NICs

• If you already participate in an Aviva SAYE plan, the £500 total applies to the total of your savings across all plans

• The first payment will be taken from your November 2017 salary

• You cannot change the amount you save. However, you can close your account at any time and have your savings returned to you. If you do this, you will lose the option to buy shares at the Option Price

• You can miss up to 6 monthly payments. If you do, your Maturity Date will be postponed by 1 month per each missed payment

• Remember, if you are currently contributing into the 2014 3 year, 2012 5 year and/or any 2010 contract, your savings allowance for the 2017 plan will not be affected by your savings contribution amount into any of these plans, as they are approaching Maturity

Step 2 - Choose what to do with your savings:

At Maturity, you can buy Aviva shares at the Option Price• The Option Price is the average of the mid-market closing price of an Aviva ordinary share across the 3

days before the Aviva SAYE invitation date

• A 20% discount is then applied to the average share price and rounded up to the nearest penny

• Whatever happens to the Aviva share price during your chosen savings period, the Option Price will stay the same, regardless of the share price changing

• You can find the Option Price here

More


Step 2 - Choose what to do with your savings:Do I have to buy Aviva shares at the end of the 3 and/or 5 year period?No, you have a choice. You can either:

• Buy Aviva shares at the Option Price OR • Take your savings in cash

What you choose to do is likely to depend on the Aviva share price at Maturity.

How it worksIf at Maturity, the Aviva share price is:

Higher than the Option Price You can use your savings to buy Aviva shares at the Option Price. You can then sell them at the current higher price, or retain the shares and become an Aviva shareholder.

Lower than the Option Price You can simply withdraw your cash savings and you will not have lost a penny. If you did buy shares at the Option Price in this circumstance, you’d be paying more for the shares than you would on the stock market.

How it Works

Don’t panic! You will be sent more information about your options closer to Maturity.

#SA

YE2

017


#SAYE2017

What our colleagues think

“ An easy savings tool. After the first month or so you don’t really notice the deduction from salary, but you do notice the fund on maturity!”

“ I like the scheme because it allows me to invest on attractive terms and having the money deducted straight from my salary makes it easier to save for the future.“

“ I have used the Aviva SAYE every year since I joined Aviva and have sometimes made a handsome profit and other times received my savings back. I have always had plans for the return in the knowledge that I would at least get my contributions back.”

Sarah Faherty

Brian Farley

Rodger Lovel


Savings calculator

Type in the amount you want to save monthly: £

Total 3 year saving: £ Total 5 year saving: £

Total share Options Total share Options available after 3 years: available after 5 years:

Select a Maturity price below to see how much your shares could be worth after 3 or 5 years!

£4 £5 £6 £7

Share value at Share value at Maturity after 3 years:

£ Maturity after 5 years:

£

Potential gain Potential gainafter 3 years:

£ after 5 years:

£

Savings Calculator

Option Price


£

Our share price


What affects the Aviva Share Price? The Aviva share price is influenced by external and company level factors. From an external perspective, trends in economic growth and government policy set the tone for investors, influencing their choices on which geographic regions and industries they would like to invest in. At a company specific level, investors make comparisons between Aviva and our peers regarding how the business is positioned in its chosen markets, the outlook for financial performance and differences in valuation. Using both the external and company level perspectives, investors will choose to buy (or sell) one company over another and these trading flows are what drive share price performance.

How does our share price compare with our competitors? Aviva is currently trading at a valuation discount to its peers. If we look at the share price compared to our operating earnings per share, our multiple is less than 10x, which is toward the low end of the peer group range of 10x to 14x. The opportunity in the near term for Aviva is to improve within this range by delivering strong growth in operating earnings and dividends. Looking further out, as we get recognition for our leadership in digital insurance and the benefits of TCC, our aspiration should be to move beyond the top end of the range.

How is Aviva working to ensure our Share Price keeps rising? There are three elements to our investment thesis that are being emphasised to investors.

First, having transformed the strength of the balance sheet, we now have surplus capital and we are using this surplus to accelerate growth by investing in our businesses and providing additional returns to shareholders.

Second, we have strong and competitive franchises and our TCC approach is a source of advantage. This is reflected in our consistent growth operating profits and ultimately dividends.

Third, we have leading intellectual property (IP) in the digital sphere and this will enable us to disrupt the insurance industry, accelerating growth and strengthening our competitive position.

The key for Aviva is to simply keep delivering strong progress in these three areas.

How does Brexit potentially affect Aviva? For Aviva, there are minimal structural effects from Brexit. Our businesses in Europe and around the world are locally incorporated and locally regulated. Accordingly, changes in the UK’s trading relationship with Europe shouldn’t have any direct impact on how our businesses perform. The main question is therefore how Brexit affects the external environment, particularly economic growth, employment levels, and asset prices, as these all contribute to our ability to grow profits and dividends. This is clearly a source of uncertainty for investors and that is weighing on share prices of a number of firms with UK operations and has also caused weakness in the pound against other currencies.

However, our businesses are delivering consistent results and I would highlight that our diversity should mitigate Brexit risk, with just under half of our operating profits being derived from outside the UK.

Where do you see Aviva in 3 years’ time? In 3 years’ time, I would like Aviva to be recognised as having leading businesses in its chosen markets and considered as the pre-eminent digital insurer. We are investing significantly in digital and our propositions have the potential to change the way people buy insurance. This is an exciting prospect that could drive upside to growth for Aviva and tangible evidence of this would be well received by investors.

Why is it a good year to join the SAYE scheme? We have made a good start to 2017, delivering growth in operating profit and dividends, maintaining capital strength and reallocating capital towards our businesses with the greatest potential. As a group, Aviva is getting leaner and stronger and we are confident in our ability to sustain growth in the coming years. The SAYE is a great way for colleagues to invest in Aviva’s long-term success that they are helping to create by providing potential for investment gains if the shares perform well, while providing protection against the risk of losses.

Will you be joining this year? Yes. I have participated in each of the share schemes that have been offered since I joined Aviva at the start of 2016.

Chris Esson Group Investor Relations Director

Our Share Price

How to join SAYE 2017

Online1. Visit our website

2. Enter your Shareholder Reference Number (SRN) (included on your invitation email) and PIN*

3. Follow the simple instructions

If you have never used the Computershare online service you will immediately be asked to change your PIN.

*Your PIN has been sent to you separately by either post or email. If you were eligible to join a previous share plan, a PIN would have been issued to you then. If you cannot remember your PIN, visit the website and click ‘Forgotten PIN?’

Text messageTo join by text, simply type the following:

1. SAYE (followed by a space)

2. Your SRN, included on your invitation email (followed by a space)

3. Add the number ‘3’ or ‘5’ (followed by a space) This indicates the saving period

4. The amount you want to save each month in pounds

5. Then send this message to: 07860 020800

As an example, if you wish to save £25 per month for 3 years your text would read: SAYE C0123456789 3 25

If you have not received a text confirmation within 2 hours, please call 0371 495 0105.

Calls from a BT line will be charged at standard daytime and evening rates plus network charges. Lines are open from 08.30 - 17.30, Monday - Friday (excluding public holidays). Text messages will be charged at your standard network rate.

You can find the terms and conditions for participating in the Aviva SAYE 2017 and for applying by text at www.computershare.com/avivashareplans, under ‘Plan Documentation’ or alternatively by calling the helpline on 0371 495 0105 to request a copy. You will be deemed to have read these documents and that you agree to all terms and conditions.

Am I eligible to participate in the Aviva SAYE plan?

You are eligible to participate in the plan if you are:

• Employed by a Participating Company • Tax-resident in the UK, Channel Islands or the Isle of Man • Employed on the invitation date (7 September 2017), and • Remain employed on the date of grant (3 October 2017)

The Participating Companies are:

• Aviva Employment Services Limited • Solus (London) Limited • Sesame Services Ltd

I work part-time. Will I be able to participate in the Aviva SAYE plan? Yes. The same limits will apply to you as to full-time employees.

#SA

YE2

017


http://www.computershare.com/avivashareplans


Questions & Answers

Who is the Aviva SAYE plan Administrator?Computershare Plan Managers (Computershare). You can contact them about the Aviva SAYE plan using the contact details on the contact page.

Where are my savings kept?The monthly contributions deducted from your pay after Income Tax and NICs will be transferred by your employing company to an Aviva SAYE account opened with The Royal Bank of Scotland plc by Computershare.

Can I participate while I am on temporary leave (e.g. maternity leave, or sick leave)?Yes you can still participate in the Aviva SAYE plan. However, if you are on temporary leave, your payments will be suspended as soon as you start your period of leave. You will need to make separate arrangements with Computershare to arrange for a standing order to be set up.

You can contact Computershare using the details here.If you miss more than 6 monthly payments during your savings period, you will lose your option to buy Aviva shares at the Option Price and you will need to close your account and your savings will be returned to you.

Do I have to join the Aviva SAYE plan each year?No, however, if you wish to join any savings contracts in the future, you will not be able to save more than the maximum monthly savings limit of £500 in total for all Aviva SAYE contracts.

Can I change the amount I contribute each month?No. Once you have joined the plan you cannot increase or decrease that amount. You can however, miss up to 6 monthly payments if you need to or you can cancel your plan at any time.

Can I miss any monthly payments?You can miss up to a maximum of 6 monthly payments during the savings contract. If you do, the date on which your contract matures, i.e. the date you can choose to buy Aviva shares at the contract Option Price, will be postponed by 1 month per missed payment. You cannot increase the amount of subsequent payments to make up for missed payments.

To suspend any payments please complete and return the Aviva SAYE plan Payment Suspension Form. Visit, www.computershare.com/avivashareplans, select the ‘Company Info’ tab, then ‘Downloadable forms’.

The return address is detailed on the form. If you miss more than 6 monthly payments during your savings period, you will lose your option to buy Aviva shares at the Option Price and you will need to close your account and your savings will be returned to you.

How do I know how much I can contribute if I’m already paying into an existing plan(s)?You can view how much you are currently contributing by logging into Aviva Share Plans website.

When applying to join the 2017 plan, you will only be able to enter the amount you have the capacity to contribute.

Any plans maturing in 2017 (including the 2014 3 year plan, 2012 5 year plan or any plans from 2010) will not count towards your savings limit.

More





Questions & Answers

What happens if I do not exercise my option within 6 months of the contract Maturity Date?Your option to buy Aviva shares at the Option Price will lapse.

What is the tax treatment of my participation in the SAYE?For employees in the UK, under normal circumstances you will not usually have to pay Income Tax or NICs on the exercise of your option to buy Aviva shares at the Option Price. However, the Option Price will be the base price for Capital Gains Tax (CGT) purposes and you will need to review your CGT position when exercising your Options or selling the resulting shares (by either contacting your local tax office or a professional tax advisor).

What if I want to stop making payments and have my savings returned?You may cancel your Aviva SAYE plan contract and have your savings returned to you at any time by logging into www.computershare.com/avivashareplans.

You will need to contact Equiniti on 0371 384 2040 to cancel a contract taken out prior to 2011. On receipt of your cancellation, the savings carrier (Computershare or Equiniti) will close your account and return your savings to you. You should normally receive payment within a week of submitting your cancellation.

Do I need to advise payroll of the cancellation?No. Computershare will advise payroll of your cancellation. Your deductions will stop in the month after your cancellation instruction is received, i.e. if you submit your cancellation instruction during August, your last deduction will be taken from your August salary and no deduction will be taken from your September salary. Any overpayment will be returned to you either through payroll or directly to you by cheque.

How much interest will I receive when my savings are returned?The bonus and interest rates applied to SAYE contracts are set by HMRC. No bonus or interest is payable on 2017 contracts. For details of bonus and interest rates on previous contracts please log in and visit ‘Plan Documentation’.

Do I have to make contributions via my payroll?Yes, unless the payments are not made through a UK or Isle of Man payroll, for example if you are on any unpaid leave, such as maternity leave. Please contact Computershare if this applies to you.

Will any dividends be paid on the Aviva shares I buy through the Aviva SAYE plan?You will not become a shareholder until the end of the contract, and only then if you choose to buy Aviva shares (rather than have your savings returned). No dividends will accrue or be payable until you havebought shares at the end of the contract. Once you become an Aviva shareholder, you will have the same rights as every other Aviva shareholder. You will be entitled to receive any dividends due on your Aviva shares, attend and vote at shareholder meetings.

What happens if I am seconded or move to another Aviva Group company?As long as you remain employed by the Aviva Group you can continue to participate in any existing contract. If you are no longer paid through a UK payroll, you can arrange to make payments direct to Computershare by contacting them directly. Please note however, if you are not subject to UK tax and/or are not employed by a participating company, you cannot join any new plan.

What if you leave Aviva?




Leaving Aviva

What if I leave Aviva before my Aviva SAYE plan contract matures?If you leave Aviva before the end of your SAYE contract, you will not lose any of your savings. Normally your option to buy shares at the Option Price will lapse and you can choose to:

1. Have your savings returned to you; or

2. Continue saving until the end of the contract. Please note however, there is no bonus or interest payable for savings made under the 2017 3 and/or 5 year plan.

If you leave due to:

• retirement • redundancy • injury or disability • the company or business unit in which you are employed

ceases to be part of the Aviva group • any other reason (except misconduct) 3 years after the

date of grant as shown on your Option Certificate, or for any other leaver reason listed in the plan rules.

As well as the choices above, you can choose to:

3. Exercise your option to buy Aviva shares at the contract Option Price within 6 months of leaving, using the money you have saved to date; or

4. If you have not already made all your payments, continue to save, making payments direct to Computershare, during the 6 month exercise period, in order to increase the number of Aviva shares you can buy as in choice 3.

If you do not exercise your option to buy Aviva shares at the Options Price within 6 months of your leaving date your Options will lapse.

If you leave the company you will receive a letter with full details of what options are available to you. You should receive your letter within 6 weeks of leaving. If you do not receive your letter within this time, please email Computershare at [email protected].

What do I do if I join the Aviva SAYE plan but leave after the date of grant (3 October 2017)?As long as your leaving date is after the date of grant, in some circumstances you may still benefit from joining the Aviva SAYE plan.

Where you leave Aviva due to redundancy, retirement, or other leaver reason listed in the rules, your option to buy Aviva shares will not lapse immediately, and you may choose to continue making your chosen Aviva SAYE contribution for up to 6 months from your leaving date. You can then choose to use the savings you have made to buy Aviva shares at the Option Price.

Example: You apply for a 2017 Aviva SAYE plan contract with an Option Price of £4 and agreed to contribute £500 per month. You are made redundant on 30 November 2017 but chose to continue saving for a further 6 months and then exercise the option to buy Aviva shares.

If on exercise date the shares are at a price of £5 per share, the following calculations will apply:

• Six monthly contributions of £500 = £3,000• Shares bought at the Option Price (£3,000/£4) = 750 shares• Total value (750 x £5.00) = £3,750• Total gain made is £750

The above information is to highlight that even employees about to leave Aviva may find it beneficial to join the Aviva SAYE plan.

How do I cancel my contract and stop the first deduction from my salary if I leave after the date of grant?Please email Computershare at [email protected] by 15 November 2017 in order that Computershare may advise your payroll accordingly. After this date you should use the online cancellation service.

If you are employed by a participating company on the invitation date, 7 September 2017, and remain employed on the date of grant, 3 October 2017, you are eligible to join the Aviva SAYE plan. If you are due to leave the company, as long as your leaving date is after the date of grant, in some circumstances you may still benefit from joining the Aviva SAYE plan. Please read on for further details.


mailto:[email protected]


Dates for your diary

Closing Date – Computershare must receive your application by 5pm on this date

You make the first payment directly from your salary

Your first payment is added to your SAYE account

3October

November

1December

Aviva SAYE 2017 Invitation Date application period starts

7September

27September

Date of Grant – you must remain employed on the date of grant in order to participate in the plan


SAYE vs. MSP

Save As You Earn vs. Matching Share PlanAviva employees can choose to invest in the Aviva MSP, SAYE or both. But what are the main features and differences between the plans?

The Aviva MSP is currently only available to employees in the UK.

Matching Share Plan (MSP) Save As You Earn (SAYE)Flexibility You can start, stop or change the monthly amount you

invest at any timeThe amount you save is fixed. Annual invitation window to join

Contributions Invest between £5 and £150 per month Invest between £5 and £500 per month

What you buy Partnership Shares at the market price each month. Aviva will match 2 free shares for every 1 share purchased up to the first £40 you contribute each month

Option Price fixed at the start @ 20% discount at the time of invitation. You can choose to purchase shares at the Option Price at the end of the saving period

Your pay Contributions deducted via payroll from gross pay (before Income Tax and NICs are deducted)

Contributions deducted via payroll from net pay (after Income Tax and NICs are deducted)

Shareholder rights Become a shareholder right away and receive dividends on your shares

You might not become a shareholder. After 3 and/or 5 years you have the choice to buy shares or take your cash savings

Leaving* If you leave within 3 years, all of your shares held in the plan will be released to you, subject to Income Tax and NICs

If you leave before the end of your 3 and/or 5 year savings contract, you get your savings back

Tax If you keep your Partnership Shares and Matching Shares for 5 years (or 3 years for Dividend Shares), any sale is free of Income Tax and NIC. There is no CGT payable when you withdraw shares from the plan - your CGT base price is the price when the shares are withdrawn

If you choose to exercise your Options and buy shares, there is potential Income Tax liability on any future dividends and potential CGT liability on any future sale of your shares

Holding period You must keep your Partnership Shares for 3 years in order to keep your Matching & Dividend shares (whilst you remain employed)

If you choose to exercise your Options and buy shares, you can sell them at any time

* Leaving due to redundancy or retirement (or any other reason stated within the Plan rules), mean that different options will be made available to you. Please see the FAQs on the Aviva Share Plans website for full details.


Any Questions?

Contact Us

If you have any questions, please get in touch with our specialist team at Computershare.

* Calls from a BT line will be charged at standard daytime and evening rates plus network charges. Lines are open from 08.30 - 17.30 Monday - Friday (excluding public holidays).

Please note that this communication and its content is for information only. It does not constitute personal, financial or tax advice. Remember that the value of Aviva shares, like any asset, can increase or decrease and you may not get back the amount that was invested. If you are in any doubt as to whether or not this plan is right for you, please seek independent professional advice. In the event of any inconsistency between this brochure and the rules of the Aviva Savings Related Share Option Scheme (the Plan) or the relevant legislation, the rules of the plan and relevant legislation will prevail. Any references to taxation are for guidance only. Please note that your participation in the Aviva SAYE plan does not form part of your contract of employment and is governed by and subject to the Aviva SAYE rules. The rules contain specific provisions relating to your rights under the Aviva SAYE plan. There is no guarantee that the Aviva SAYE plan will be operated in future years, or if it is operated, that you will be eligible for participation in it. Copies of the Aviva SAYE rules and prospectus are available on the Aviva Share Plans website at www.computershare.com/avivashareplans.

www.computershare.com/avivashareplans

[email protected]

0371 495 0105*

About Computershare Plan Managers

The Aviva SAYE is administered by Computershare Plan Managers.

You can find out more about Computershare at www.computershare.com or by contacting them using any of the details on this page.





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