Business partnersHow we share value

We work with lots of different business partners. They play a vital role in helping us develop, market and sell our products and services.

Most Aegon products are distributed via independent agents, banks, brokers and other financial intermediaries. We also work closely with reinsurers – last year, we paid €3.4 billion in reinsurance premiums (and in return received just under €4.3 billion in claims). Our goal is to create partnerships that help grow our business, and also bring value to the organizations we work with.

Joint ventures

In a number of countries, we operate through joint ventures. Usually, these joint ventures help us enter new markets, particularly where a local brand is better known than Aegon, or rules make it difficult for us to operate on our own. In China, for example, where there are restrictions on foreign ownership, we have Aegon THTF, a joint venture with Tsinghua Tongfang, a Chinese software and consumer electronics firm associated with Tsinghua University. Joint ventures also help expand our distribution networks. We have a long-term partnership in place with Banco Santander; this allows us to sell through the bank's retail branches and helps Banco Santander offer its customers both life and non-life insurance alongside its own banking services. Recently, we extended the partnership to cover health insurance as well. Today, our Banco Santander partnership covers nearly 3,400 bank branches in Spain and Portugal.

We're also using joint ventures to expand the reach of our asset management business – in China with local investment firm Industrial Securities and, in France, with La Banque Postale, the banking arm of the French post office. Our partnership with La Banque Postale means that, via our joint venture, we can now sell through the post office's more than 17,000 branches across France (those 17,000 branches make La Poste the largest retail network of any kind in France, and one of the largest in Europe).

Distribution

To distribute many of our products and services, we work with financial intermediaries. These may be brokers, agents, financial advisors or banks. Often, markets have different local traditions. In Spain and France, for example, most insurance is bought through banks. In the UK, it tends to be through independent financial advisors. We maintain close relations with our distributors and provide in-depth training, so they understand our products and, where relevant, are able to support our customers more effectively. Recently, in China, we launched Zeus – a new application which allows agents to complete digital underwriting in less than five minutes. Our asset management business also uses distribution partners, including independent investment advisors and third-party investment platforms. In the UK, we have an advisory board for intermediaries, with representatives from 30 different firms. The Board helps us understand the concerns and priorities of the advisors we work with.


In recent years, we've seen a shift in distribution. This is the result, partly, of new technologies. These technologies are shortening the distance between finance companies and their customers (in effect, making it easier for companies to reach those customers directly). Overall, we are selling more direct, online and through our tied agents – though the majority of our products and services are sold through intermediaries, and they remain a valuable and important long-term sales channel for us. Because of regulation changes, life insurance and pensions intermediaries in the UK and Netherlands now generally receive fees, paid by customers, rather than commissions. In the Netherlands, we sold our own distribution business UMG though we continue to sell Aegon products through UMG. Commissions to intermediaries last year totaled €2.7 billion.

Suppliers

As a finance company, we don't have a particularly long or complex supply chain. We do buy in goods and services, however. These include management services from outside consultants and advisors, as well as utilities and office equipment. We work particularly closely with our auditors, PwC. Last year, we paid €46 million in audit fees. We have a Sustainable Procurement Policy, which applies worldwide. Under this policy, our businesses regularly assess their suppliers against minimum social and environmental standards. Failure to meet these policy standards may mean we refuse to work with specific suppliers. Our Global Procurement function is also currently taking measures to strengthen awareness among suppliers of Aegon's Code of Conduct.

Lower commissions

(Commissions paid to brokers and
other financial intermediaries, 2015-2017, € billion)