Aegon Asset Management is pitching insurance and pension fund clients an uncommon wrapped product, taking assets including emerging market sovereign loans and bonds, corporate loans and bonds, ABS bonds, significant risk transfers (SRTs), infrastructure debt, project finance, leveraged loans, and fund finance exposures and transforming them from B/BB-equivalent to A/AA with a full credit insurance wrapper.

Credit insurance is a large market and loans exposures are commonly credit-insured, often for the benefits of the originator, but offering clients a portfolio of 100% insurance exposure without any ‘naked’ — uninsured exposure — risk is what sets the product apart.

“We're asking the insurers to insure our clients for 100%, that is a big barrier to entry,” said George Nijborg, head of insured private strategies and EU private placements at Aegon AM. “We had to spend a lot of time with the insurers, getting them comfortable with the way the product was structured, and the protections they have.”