Aegon to Divest U.K Protection Business

Aegon AGN has announced the divestment of its U.K. individual protection business, but we don’t think this changes the company’s outlook. The divestment of the individual protection book includes life insurance, critical illness, and income protection policies for high-net-worth individuals that are customers. These Aegon products were sold to these 400,000 customers by independent financial advisers. While the financial terms of the deal have not been disclosed, strategically, management has long communicated a focus on retail and workplace savings in this market and has by and large been derisking critical illness. New life sales have been very low for some time in this part of Aegon’s business. As this does not alter the firm’s strategic direction and we anticipate it will not be a meaningful divestment, we maintain our fair value estimate and our rating of no economic moat.