In a significant move to expand its footprint in the UK protection market, Aviva has announced the acquisition of AIG Life Limited, a subsidiary of American International Group, Inc. (AIG), for a sum of £460 million. This strategic acquisition is in line with Aviva’s goal to grow its capital-light businesses and will add a substantial 1.3 million individual and 1.4 million group protection customers to its portfolio.

Amanda Blanc, Aviva’s Group Chief Executive Officer, expressed her enthusiasm about the acquisition, stating that it not only brings considerable strategic and financial advantages to Aviva but also fortifies their position in the lucrative UK protection market. She emphasized Aviva’s commitment to capital-light growth and expressed eagerness to welcome new customers and colleagues from AIG Life UK.

Existing customers of AIG Life UK can anticipate benefiting from Aviva’s renowned expertise and robust financial standing. The merger promises to harness AIG Life UK’s innovative solutions and robust partnership distribution, ensuring a more efficient platform for both existing and potential customers.

Funded internally by Aviva, the acquisition represents 0.9 times AIG Life UK’s Solvency II Own Funds, post capital synergy adjustments. The deal is expected to slightly impact Aviva’s Solvency II shareholder cover ratio, with a projected reduction of around 5 percentage points as of June 2023.

Subject to regulatory approvals and customary closing conditions, the acquisition is slated to be finalized in the first half of 2024.