Aegon withdraws from group risk market

Group risk products typically provide companies with life insurance, critical illness and income protection for their employee benefit programs.

Aegon said the market for these products was generally mature and dominated by a few large providers - and noted that, because it had a sub-scale in-force business with limited prospects to achieve sufficient economies of scale, it would exit the market.

It said it would pursue growth opportunities in more profitable business segments such as pensions, individual protection, investments and annuities.

The firm said it would also withdraw its flagship retirement income plan - claiming the cost of providing the guarantee for the product had became too expensive.

The life and pensions firm said it would replace its 5 for Life plan with the Secure Lifetime Income Plan on June 29 - but would continue quoting for new business on 5 for Life until June 12. Customers have until June 26 to pay in money to the plan.

It said it had replaced the product in order to reduce the costs of 5 for Life - which offers a minimum lifetime income of 5% for life.

It said a combination of low interest rates and high market volatility had caused the price of the guarantees to soar.