Ryan FowlerAegon UK has reached a major milestone by integrating three Long-Term Asset Funds into its largest workplace default fund, the Universal Balanced Collection.
The move brings more than £1bn of private market assets into the default strategy and makes Aegon UK the first defined contribution provider to embed three LTAFs within a workplace pension solution.
The development is designed to support more than 700,000 members with access to private market opportunities that have typically been out of reach for most workplace savers.
Aegon UK said the strategy is centred on improving member outcomes through broader diversification and the potential for improved risk-adjusted returns.
The private market exposure includes investments in renewable energy, sustainable infrastructure and forestry, and forms part of the provider’s commitment to the Mansion House Accord target of allocating at least 10% of default fund assets to private markets by 2030.
Lorna Blyth, managing director of investment proposition at Aegon UK, said: “This is a defining moment, not just for Aegon UK, but for the future of long-term investing.
“Together, we’ve turned ambition into action, unlocking private markets for over 700,000 members and setting a new standard for innovation, sustainability and value in workplace pensions.
“The next step is to deploy the LTAFs into our Master Trust default, comfortably helping Aegon pass the £25bn asset under management threshold for DC schemes.”
Aegon UK plans to increase LTAF allocations within the Universal Balanced Collection to a combined target of 17% by 2028.
It has partnered with three specialist fund managers to deliver a range of tailored private market solutions.
BlackRock is providing a bespoke, diversified alternatives strategy spanning private equity, private debt, real estate and infrastructure.
Aegon Asset Management is offering a private credit LTAF covering corporate lending, fund financing, insured credit, renewables and asset-backed finance.
J.P. Morgan Asset Management has developed a strategy drawing on its global alternatives platform, providing exposure to areas such as private equity, infrastructure, transportation and forestry.
The Universal Balanced Collection is available to investors in Aegon Retirement Choices and One Retirement, as well as selected off-platform products. Aegon UK said the expansion reflects a long-term plan to embed private markets more widely across its workplace proposition.
