AEGON's decision to remain in individual protection markets was due to "significant overlap" with its chosen core markets, the provider has said.
In a protection news letter, setting out Aegon's position on how protection fits with its focus on the ‘at retirement' and ‘workplace savings' markets, Alun Beynon, head of sales and distribution, said protection would be "core".
He noted that Aegon's 's 'at Retirement' demographic is 45+, people starting to prepare for retirement. This retirement however is unlikely to be before age 60 or 65 and they will still potentially be carrying financial liability throughout this period. thus the need for protection for the middle aged customer is likely to increase.
Beynon said: "They will still need to cover their ongoing financial liabilities and insure their retirement funding in the event that death or serious illness curtails their ability to accrue sufficient wealth to provide for themselves or their dependents.
"Likewise, the ‘workplace savings' market presents some excellent cross-selling opportunities for advisers and providers.
"This will be particularly relevant for the small medium enterprise market, where the loss of key personnel through death or illness can have a serious impact on the financial stability of an organisation.
He added: "It's these markets that rely on quality advice and are not as exposed to persistency and profitability risk that is evident in the rate driven commoditised market for life assurance."
Commenting on the decision, Tom Baigrie, managing director of IFAs Lifesearch, said: "Our ailing economy has made the need for Protection Insurance greater than ever and so the renewed commitment of such a substantial insurer is crucial at the current time.
"The Protection Insurance industry is currently at a crossroads. Either it is ready to grasp the nettle and plug the gap left by the ever-shrinking welfare state, or it will timidly retreat from this opportunity and continue to shrink away, covering an ever smaller proportion of people with the products they need."
