This commitment is a result of the recent agreement on Solvency II, the European-wide insurance regulation, which provides greater regulatory and political certainty for insurers to invest in infrastructure assets.
Aviva’s allocation is the first tranche of the wider insurance industry’s commitment to invest £25bn in UK infrastructure in the next five years.
Aviva said that it expects to allocate new funding for debt financing of UK infrastructure projects in a range of sectors including transport, utilities, hospitals and schools. The funds to support this investment are available immediately, are in addition to Aviva’s existing level of infrastructure investments. The company said that it was already evaluating a number of potential investment opportunities.
Aviva currently has £5bn invested in a range of UK infrastructure assets including PFI loans for social infrastructure such as schools, universities and hospitals and investments in corporate bonds of utility, airport and rail companies.