Aegon has increased the value of new business by 77% in the first quarter of 2007, with life and pensions new business growing 37% to £297m API.
In its first quarter figures the insurer reveals the VNB rose 77% to £39m compared with the same period in 2006, while operating earnings increased by 19% to £44m over the first three months of the year.
It says it has seen particular growth in the life and pensions market, which rose 37% on a year-on-year basis to £297m on an API basis – which is new annual premiums plus one-tenth of new single premiums.
Aegon suggests the effects of pensions simplification is continuing to drive business in the individual pensions sector, which grew 69% to £106m, while group pensions new business saw a 10% increase on 2006 figures.
In addition, the firm says individual annuity business is also boosting life and pensions sales, with a rise in new business of 72% to £30m, while offshore bonds grew by 79% to £23m.
Aegon also reveals its entrance into the bulk annuity market - which it announced in March – has seen an encouraging start since it started quoting for business in November.
However, it says as there is a long lead time between successfully winning a mandate and receiving the funds, the first quarter figures only reflect the details of one case, which provides a figure of £11m.
Lesley McPherson, spokeswoman for Aegon, says: “This is right in the territory of the small to medium businesses which is our target market, and in addition we have had quite a lot of requests to participate in quotes.”
“We are feeling quite competitive and very upbeat about the proposition as we have received good feedback from the market. We are off the ground now, so it’s all to play for.”
In addition the figures reveal protection business also increased in the first quarter by 3% to £10.8m compared to 2006, while the Aegon Asset Management also increased retail sales by 41%, although institutional business fell from £188m last year to £8m.
Otto Thoresen, chief executive of Aegon UK, says individual business has seen the most striking growth with new business volumes up 60% compared with the first quarter 2006, but he points out while pensions new business is still strong, the company is also seeing increased new business in annuities and asset decumulation, as the baby boomer generation approaches retirement.
And he adds: “On the corporate side, we’ve seen an encouraging start to our bulk annuities business, with our proposition proving competitive within our target small to medium size business market. We are looking forward to seeing this key development area build over the months and years ahead.”
“Aegon has an attractive and diverse range of businesses which meet the emerging needs of the individual and corporate customer. Our aim now is to make our products available to a wider range of customers by extending our distribution strategy and developing new partnerships in the months ahead.”
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