Why do Ratings Matter?
A rating downgrade of Aegon or any of its rated insurance subsidiaries may, among other things, increase the number of policy surrenders and withdrawals by policyholders of cash values from their policies. Cash payments to policyholders could require invested assets, including illiquid assets, to be sold at a loss, leading to a decrease in total invested assets as well as a decrease in net income. Early withdrawals could also cause Aegon to accelerate amortization of policy acquisition costs, reducing net income.
A rating downgrade may also adversely affect relationships with broker-dealers, banks, agents, wholesalers and other distributors of Aegon’s products and services, which could negatively impact new sales and adversely affect the Group’s ability to compete.