Aegon fails to reduce charges after passive switch

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Aegon is continuing to charge clients the same level of fees despite switching them from an active to a passive fund.

In a letter sent to an adviser and seen by Money Marketing, Aegon says following a review from 25 October its North American fund is switching from being actively managed by Kames Capital to passively managed by BlackRock.

The provider says the risk rating and yearly charges for the fund will not change as part of the switch, but does not spell out the cost of the new fund.

An Aegon spokesman says the total charge of the new fund is 1 per cent “as a standard product charge”.

He says: “The North American fund had no additional fund charges or expenses attached to it, so for our older packaged pension products there’s no change in the fund charge. The total charge for this fund is 1 per cent which includes product charges.”

When asked, the spokesman declined to comment on why the change from active to passive has not been accompanied by a reduction in the annual management charge.

Aegon has also not provided details on the number of clients affected.