Legal & General has acquired a £3bn UK annuity portfolio from Aegon for an undisclosed sum.
The deal has been structured as a reinsurance contract initially covering around 27,000 in payment policyholders. They will remain Aegon customers and will continue to be serviced by Aegon until the business is transferred, subject to regulatory approval.
As at 31 March, L&G managed an annuity book of £45.5bn. It completed £2.4bn of bulk annuity deals last year.
L&G retirement managing director Kerrigan Procter says: “We are delighted Aegon has chosen L&G to secure its policyholders’ annuities.
“In the UK there is an estimated £100bn of individual annuities in back books and we expect further back book consolidation.”
Aegon chief executive Alex Wynaendts says: “I am very pleased we are able to announce this transaction. Achieving the divestment of our UK annuity portfolio is an important step in the strategic repositioning of our business in the UK. The divestment enables us to fully focus on growing our platform business.
“At the same time, I am pleased we have found in L&G a good home for our annuity customers.”