Platform focus: Can Aegon shake its middle of the road status?

Heather Hopkins

Our new series of platform focuses will run on a bi-weekly basis, with the list of adviser platforms ordered alphabetically. Aegon comes first.

Aegon is the youngest of the platforms we consider but is the fastest growing. Assets under administration at the end of June were £4.63bn, up 139 per cent in the past year. Net sales figures remain strong, just shy of 90 per cent of gross sales. The three-year-old platform ranks 16th among the 23 adviser platforms we track. It should be noted that while Aegon’s growth is fuelled by the transfer of off-platform assets the firm is also attracting more advisers to the platform.

Aegon was well placed for the pension reforms, yet it is still regarded as a niche pension player by most industry observers. Some 88 per cent of platform assets are in a pension wrapper and, as one would expect for a niche player, only one-fifth of advisers that use the platform tell us it is their primary one.

Advisers that use Aegon like it and only a small minority are looking to transfer assets off. Firms that see a rapid rise in assets often see a corresponding decline in customer reviews. However, Aegon’s reviews have held steady and even improved in the past several quarters. The reviews do remain stubbornly middle-of-the-pack, though, and advisers say they use Aegon for the retirement solution, not the service.

aegonplatformfacts

Indeed, advisers praise the platform for the simplicity of the retirement solution both for themselves and their clients. They say it is easy to use and give particularly high scores to BDM support.

But customer service issues persist and some perceive the platform as pricey. Rate card prices are relatively high but once the charge cap kicks in prices become very competitive for larger accounts.

Along with other life companies, some question Aegon’s long-term commitment to financial advisers. We do not see any evidence of that. In fact, the recent launch of its secure retirement income product is being well received.

The secure retirement income product, launched in July, is designed to meet growing demand for flexibility and income certainty. The product offers annuity-style guarantees with the flexibility of income drawdown.

Aegon provides a guarantee on minimum income while keeping the pension invested with potential for growth. Advisers are able to flexibly move client money between the guarantee and their centralised investment proposition, enabling control over all client assets.

Aegon has made a big play to unify workplace savings with wealth management. In the face of a commission ban and the pension reforms, the proposition looks very compelling.

Heather Hopkins is research director at Platforum

Adviser view: Dennis Hall, managing director, Yellowtail Financial Planning

“The Aegon platform is the fastest growing platform with more than £3bn since launch. I am surprised they have grown that much in such a short time after being a late entry to the market. I had assumed that most firms would have already made their platform choices so I’m puzzled where this growth has come from. They’ve certainly not registered on my radar.”

Ian Thomas, director, Pilot Financial Planning

“Aegon is starting to gain traction as a platform and has broadened out its distribution base considerably. It has been progressive in recognising that an ad valorem charge does not work for high-net-worth clients, and there is the ability to choose which parts of the process are advised and which are self-directed. Unfortunately the platform itself is not market-leading and the technology is looking a bit tired. Aegon needs to revisit this.”