Aviva is closing almost all AIG Life products to new business this summer, with any new quotes needing to be submitted before 16 August and subsequent applications given a further 30 days for submission.
Only AIG Life UK’s high net worth offering is being largely retained as Aviva said it wanted to keep this speciality and the “strong partnership distribution” while single-tie distribution will continue.
AIG Life UK CEO Phil Willcock will be leaving the organisation as Aviva managing director of protection Fran Bruce will take over the combined operation, subject to regulatory approval.
AIG Life UK managing director of individual protection Nick Austin has been appointed to a newly-created role as protection commercial director and will lead a commercial centre of excellence to bring together the combined pricing, reinsurance and scheme underwriting teams.
When asked by Health & Protection, Aviva did not say how many jobs would be lost as part of the merger, noting there were other opportunities being offered to those affected and the majority of AIG Life roles will TUPE (Transfer of Undertakings Protection of Employment rights) into Aviva.
Advisers will continue to receive their current rate of AIG Life commission and it will continue to be paid for as long as it is due and advisers can continue to use their usual person of contact at AIG Life.
However, Aviva said some of these may change as part of bringing the businesses together, and it will let advisers know any changes as soon as it can.
On replacements for the AIG Life products being closed to new business, Aviva said it has a full suite of individual protection products which most advisers were familiar with which covered the same needs and target market.
It said if there was a specific feature not available on Aviva’s products, advisers should let their usual contact know, adding its proposition was always evolving and the insurer wanted to hear feedback and ideas.
Following news of Aviva’s £453m acquisition of AIG Life UK, protection advisers told Health & Protection they hoped Aviva would retain “unique” aspects of AIG UK’s offering.
One of those “unique” aspects was AIG’s expat cover which Health & Protection exclusively revealed was being pulled by Aviva last month.
Quote and application deadlines
Aviva said that after careful review of AIG Life’s core individual and group protection products, due to their similarities it will only continue with the Aviva-branded core propositions for new intermediated business.
The final submission date for AIG-branded quotes for intermediary distributors will be 23:59 on 15 August 2024.
It said the “significant phase of the integration aims to give stakeholders a clear position on new business products going forward and certainty to customers and intermediaries of a single product offering”.
Any quotes or applications submitted before this date, it added, will remain valid and it will work with intermediaries to support any pipeline business.
Individual protection quotes will remain valid for 30 days and applications submitted will remain valid until 15 February 2025.
Group protection quotes or applications already in the pipeline will be guaranteed until 15 November 2024, or the quote validity period stated on the quote if earlier.
Aviva also told Health & Protection there were no changes to group scheme rate reviews and renewals, meaning that clients with existing AIG group protection cover will be able to renew their AIG group protection cover.
Other key parts of its communication to intermediaries and partners, included:
- There is no change to existing insured AIG Life group protection schemes. The rate review process, policy administration, individual assessment of claims will continue as normal. Schemes within the rate guaranteed period will continue to be reviewed
- Existing customers and business clients will have no change to the cover they have from AIG Life and they will be supported them in the same way that they have always been
- New or existing AIG Life customers will still have access to the health and wellbeing service AIG Smart Health provided by Teladoc, but as this is a non-contractual benefit Aviva said it could be changed or withdrawn in the future
“As we continue to work towards a smooth transition of the AIG Life business, we will share further relevant information with our distribution partners when we can,” Aviva said.
On whether advisers can quote from AIG Life for a scheme currently insured with Aviva prior to 15 August, Aviva confirmed AIG Life will not be providing quotes for schemes currently insured by Aviva.
Online quote system
AIG Life’s online quotes system will remain open from 15 August until 15th November 2024 to allow advisers to obtain re-quotes, amend previously issued quotes or accept a quote in the normal way.
However, all quote amendments and revisions must be placed on-risk prior to the expiry of the quote validity period stated or 15 November, whichever is earlier.
AIG Life’s online system will remain open indefinitely to allow advisers to administer policies and conduct rate reviews.
Where advisers want a new business quote from AIG Life after 15 August 2024, Aviva said it recommended advisers contact Aviva to obtain a new group protection quote.
On obtaining a quote from Aviva, for schemes with three to 250 lives advisers should use the insurer’s online portal, while for terms over 250 lives they should contact the insurer directly.
All new business quotes issued by AIG Life prior to 23:59 on 15 August 2024 will remain valid for the quote validity period stated, usually three months.
It also confirmed advisers can make changes to quotes already received from AIG Life.
During the quote validity period, advisers can make simple amendments or revisions to the quote, such as changing commission, amending the benefit basis or updating membership.
They are advised to contact AIG Life in the normal way to make these changes. If the quote was obtained online, advisers can amend the quote online, in the normal way.
Any revised quotes will be valid until the quote validity date or 15 November 2024, whichever is earlier.
And on the process for placing a quote on-risk with AIG Life, advisers have been told to follow AIG Life’s usual on-risk process.
Online quotes can be accepted online and an application form will be produced which must be fully completed, signed and returned by the client prior to the expiry of the quote validity period or 15 November, whichever is the earlier.
Advisers should contact AIG Life to accept an offline quote and their team will explain the process.
If the quote has not been placed on-risk by AIG Life prior to the expiry of the quote validity period, or 15 November 2024, whichever is the earlier, the quote will expire and cannot subsequently be placed on-risk.
High net worth business
Aviva said it was keen to retain several attributes of AIG Life’s business, specifically the high-net-worth channel and the “strong partnership distribution”.
Distributors who have worked closely with AIG Life in the high-net-worth market will continue to be able to offer AIG Life products to clients, as Aviva does not currently offer some of the options available within this proposition.
Aviva said it will be exploring how it can grow its capabilities in this area as a key focus for the combined business.
It also confirmed new business will continue under AIG Life for existing single-tie relationships and contractual relationships, and it will continue to work closely with these key partners.
It clarified AIG Life protection products remain open for single-tie distribution partners and selected specialist firms placing high-net-worth business, except care cover with whole of life insurance. This product will close to all new quotes and applications at 23:59 on 15 August 2024.
Senior leadership team and personnel changes
In the boardroom, Phil Willcock has decided to step down as CEO of AIG Life later this year, while Nick Austin, MD of individual protection at AIG Life, has been appointed to a newly-created role as protection commercial director.
Austin will lead a commercial centre of excellence to bring together the combined pricing, reinsurance and scheme underwriting teams, Aviva said.
Aviva said some senior leaders from AIG Life have been appointed to roles within Aviva including head of people for protection and health, and commercial director, protection.
AIG Life’s senior leadership team includes chief financial officer Donald MacLean, chief information officer Michael Sasaki, chief risk officer Ruth Middleton and chief compliance officer Shalini Pandita.
Other appointments have also been confirmed for AIG Life leaders in areas such as risk, compliance, IT and HR.
The insurer told Health & Protection it would not give any more details on individuals and did not give any details about the number of jobs potentially affected by the merger.
However Aviva said its intention was to retain as many people in the business as possible and the majority of AIG Life roles will TUPE into Aviva.
It added that while there will be some roles affected by today’s development, it was committed to providing opportunities to as many of these individuals as possible elsewhere in the wider Aviva group.
“A number of vacancies have been prioritised for AIG Life colleagues for those who want them,” it told Health & Protection.
“We appreciate that this is an unsettling time for people and we will work through the process as quickly as possible.
“The areas primarily impacted by the planned closure to new business are AIG Life distribution and marketing.
“We will not be confirming a number, as although some roles will be affected, there are multiple opportunities for individuals to explore and transition to other roles in the wider Aviva group.”
Clarity on plans
Managing director of protection Fran Bruce said: “We’re pleased to be able to give clarity to our colleagues, customers, intermediaries and partners about our plans for our future product offerings.
“There are great elements about each of our respective propositions that complement each other well and we believe the combined features will help us realise our growth ambitions in the protection market.
“Over time, our aim is to continue enhancing our propositions and products with the combined knowledge and expertise that we have gained through the acquisition of the AIG Life business and their talented people.”