* New life insurance sales up 28% in Q1
* Shares up 2%, one of biggest FTSE gainers
* Faces possible legal action from UK hospitality firms
(Adds analyst, shares, CFO comment, hospitality claims)
By Carolyn Cohn
LONDON, May 21 (Reuters) - British insurer Aviva expects 160
million pounds ($195 million) in claims related to the
coronavirus pandemic and weaker second quarter sales, it said on
Thursday, as government lockdowns aimed at containing the virus
hit the global economy.
Insurers globally are likely to face more than $107 billion
in underwriting losses due to the pandemic this year, similar in
size to major hurricane years, the Lloyd's of London insurance
market said last week.
"We've had a pretty good first quarter," Aviva Chief
Financial Officer Jason Windsor told Reuters.
"Q2 could look pretty different, we know there will be
materially lower activity."
Aviva, which has operations in Asia, mainland Europe and
Canada as well as Britain, said new life insurance sales rose by
28% to 12.3 billion pounds in the first quarter, helped by a
strong performance in bulk annuities, which involve taking on
the risk of company defined benefit pension schemes.
General insurance net written premiums rose 3% to 2.4
billion pounds.
Aviva's shares were up 2% to 244 pence at 0718 GMT, one of
the biggest gains on the FTSE 100, with Shore Capital
analysts describing the results as "solid".
Most of the COVID-19 claims are coming from lines such as
business interruption and travel insurance, Aviva said.
A number of top insurers are facing possible legal action
from small firms in Britain which have not received payments for
their business interruption insurance due to the pandemic.
Law firm Mishcon de Reya, which is advising a group of
British hospitality businesses, said this week it was narrowing
its focus for a potential claim on Aviva and QBE.
Aviva said on Thursday the "vast majority" of its commercial
policies did not cover business interruption claims arising from
COVID-19, but it had paid some claims in Britain and Canada
where cover was in place.
QBE declined to comment.
($1 = 0.8201 pounds)
(Additional reporting by Kirstin Ridley and Muvija M., editing
by Sinead Cruise and Mark Potter)
Aviva (AV.)