This week Mark Loosmore of AT8 Group looks at the belated entry of Aegon into the still growing wrap marketplace.
Just as I thought I had written my last article on platforms, there came the announcement from Aegon that it had teamed up with Novia to launch its own wrap proposition. Aegon is a large brand and the proposition is significantly different, so it is well worth extending the series on platforms for one more week.
Aegon needs little introduction; in the UK alone it offers pensions, life insurance, asset management and financial advice to around two million customers and has assets under administration of £57.6bn. The firm has sat on the fence for some time on the issue of platforms, with rumours circulating for many months, even years, about a possible entry into the wrap market.
The rumour mill went into overdrive in February, when Aegon announced the appointment of Paul McMahon as Aegon UK group marketing director. McMahon was recruited from Friends Provident where he was managing director, but his previous role at AXA included leading the development of its ‘Elevate’ wrap offering. His appointment, for many, signalled a clear intent to enter the market.
At retirement and workplace savings focus
One of the Aegon platform’s differentiators is that it will have a defined focus. The proposition is aimed at the at retirement and workplace savings markets and supports the move it made last year to focus on these two sections within the UK.
At a high level, this strategy could make sense.
Most mainstream platforms operate across the marketplace supporting accumulation of funds and a clear proposition aimed at the at retirement space may be able it to differentiate itself from the crowd, but at this stage there is little detail about what the proposition will comprise in practice.
The new platform proposition will be offered alongside Aegon’s existing range of pensions, investment and protection products. Aegon claims the platform and packaged products offerings “will help meet the changing needs of advisers and customers” in its two chosen growth markets.
Aegon freely admits that it is late to market compared with other traditional product providers like Standard Life and AXA, but this could give Aegon the advantage of learning from the experiences of others. This has led to Aegon choosing another wrap platform – Novia – rather than a pure technology company to launch the platform.
Industry Voice: Scottish Widows pension expert Robert Cochran and economist Andrew Scott discuss the future of employment and income, in episode three of Scottish Widows' podcast series.
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