Aviva has dropped its court battle with Bankia after reaching a £494 million settlement with the Spanish bank, following a dispute over distribution agreements.
Aviva and Bankia have now applied to the arbitration court in Madrid to terminate legal proceedings.
The dispute related to Aseval, a joint venture launched between Aviva and Spanish bank Bancaja in 2000. Under the terms of the agreement, Bancaja was to distribute life and pensions products exclusively from Aviva.
But after a merger saw Banacaja brought under Bankia, Aviva claimed the agreement had been breached, with other insurers providing products through Bankia.
Aviva had pursued legal proceedings against Bankia, but those have now been dropped after the insurer agreed to sell its holding in Aseval to Bankia for £494 million.
Aviva chairman John McFarlane (pictured) said: 'This settlement is in line with our strategy to increase Aviva's financial strength and we have realised significant value from our joint venture with Bankia.
'We remain focused on providing excellent service to our customers in Spain, through our other bank partners and distribution agencies.'