The competition regulator has opened an investigation into Aviva’s £460m takeover of AIG Life UK and its potential to substantially lessen competition in the sector.
The initial part of the investigation is an invitation to comment on the merger which is open for responses until 22 February.
Launching its review, the Competition and Markets Authority (CMA) said it was considering whether the purchase may create a situation that “may be expected to result in a substantial lessening of competition”.
“To assist it with this assessment, the CMA invites comments on the transaction from any interested party,” the regulator added.
The statutory deadline for the CMA to announce its decision whether to refer the merger for a phase two investigation is 8 April, although this may change during the assessment process.
The insurers announced the deal, which will see Aviva buying the AIG Life Limited business from AIG subsidiary Corebridge Financial, in September.
At the time, advisers told Health & Protection they would be disappointed in the loss of competition and to see AIG Life’s exit from the UK protection market, citing its cover for high net worth individuals (HNWIs) and customers’ with families as key elements.
Responding to the CMA investigation an Aviva spokesperson said: “It’s typical for transactions to require regulatory approval and this deal is no different.
“We continue to expect the transaction to complete in the first half of 2024 subject to regulatory approvals, and we will provide an update in due course.”
AIG declined to comment.