Baillie Gifford is launching a life office to capitalise on the move to defined contribution schemes in the pensions market.
It is the first fund manager to set up a life operation since publication of the Treasury paper on Lifelong Individual Savings Accounts, which is expected to accelerate the trend towards DC plans.
Baillie Gifford Life will be the company's main vehicle for chasing the DC market.
It has more £300m in its life fund, having already picked up three DC clients this year, but aims to have attracted around £700m by the end of the year.
It will also seek to increase the returns to existing UK pension fund clients of its Managed Fund by increasing the tax efficiency of investments.
Baillie Gifford Life managing director Chris Fletcher says: "A life company is flexible and you can do various things within it.
"If you are in the DC market, it is the most flexible and it works. The ability to price on a gross basis is the biggest advantage."