Scots at the vanguard of Aegon's push into Indian life assurance market

Published on Sunday 3 September 2006 00:07

THE Scottish office of Aegon, the financial services group, will lead the Dutch giant's first move into the fast-growing Indian life assurance market.

The company has recently signed an agreement with Ranbaxy Promoter Group, an Indian conglomerate, to build an insurance and asset management business in the subcontinent.

Otto Thoresen, the chief executive of Aegon UK, will draw together a management team from the firm's Edinburgh office to develop and manage the venture. The team will include 12 senior managers from finance, actuarial, underwriting and regulation divisions led by programme manager John Mungall. The UK team will design the operating model for the new business, provide its technical basis and run it through to launch.

Teaming up with Ranbaxy will give Aegon access to 150 offices run by Religare Enterprises, a financial services subsidiary of the Indian group.

Thoresen said: "Being given responsibility for the launch of Aegon's India joint venture is a great accolade for our UK team and reflects the growing importance of the UK within the worldwide group."

Aegon has had India in its sights for years because of the country's huge population and rapidly developing economy, the relatively low penetration level of insurance in the country, and the strong growth rates projected for the insurance sector.

The Indian life assurance market has trebled in size since 2000, but life assurance sales as a share of income are low by international standards, providing an opportunity for international groups like Aegon.

The move comes as Aegon rebrands its UK operations to emphasise the international strength of its Dutch parent group. Scottish Equitable, the pensions business which Aegon acquired in 1994, will now be known as Aegon Scottish Equitable.

Aegon hopes the new name will reinforce its global identity, backed by assets of 245bn, without dropping the ScotEq brand, which research showed was still popular with independent financial advisers.

Thoresen said: "We talked to customers who had no recognition of who was backing the organisation. Our staff asked us why we made it so difficult. The main objective of this change is a clarity and consistency."

Aegon UK recently reported an increase in underlying earnings of 26% to 86m and an increase in new business of 55% to 499m API for the first six months of 2006, compared with 2005. The value of new business rose 61% to 53m.