commitment to service have been instrumental in the growth of the business. Over the past few years, we have doubled the number of producers in our independent producer channel.  Pension Group deposits continue their growth, driven primarily by sales in the mid-to-large plan market. The Pension Group has gained considerable advantage by investing in its technological infrastructure to meet the growing complexity of the business and increased sponsor demands. As a result, plan processing and administrative functions are handled more efficiently, while participants benefit from improved capabilities to assess their account information and retirement planning via the web. Sales have also been encouraging in the fast-growing small-plan market where products are distributed through independent producers and professional organizations as well as leading banks and brokerage firms. The Pension Group has been successful in company-wide cross-marketing initiatives.  In an environment of increasing competition, regulation and cost of distribution, there has become a stronger need for greater quality and efficiency throughout our business in the Netherlands. Going forward, it is vital that we structure ourselves in a way that enables the business to grow profitably and to fulfill the ever changing and increasing needs of our customers, in all the markets in which we operate. Subsequently, a number of necessary steps have been taken to restructure the business. The new AEGON The Netherlands will be a business that can deal with dynamics and developments in the market more efficiently than under the previous structure. The thirteen business units, which had been operating as independent businesses from various sites throughout the country, are making way for five service centers and four marketing and sales organizations, at only three locations. This new structure not only provides for benefits of scale and a higher level of quality due to centralization and standardization of processes in the production environment, it also gives focus to the marketing and sales organizations and allows them to develop products tailored to customer needs more efficiently. The new structure helps to build close and strong relationships with the distributors, enabling us to better and more quickly understand the changing needs of our current and potential customers. AEGON The Netherlands is on the move, towards an organization where the customer, again, is the motive power of our business. While the restructuring will result in staff reductions, it is important to emphasize that this will be achieved through attrition rather than through compulsory redundancies.  AEGON is the second largest life insurer in the Netherlands, with a strong position in individual, group life and pension businesses. Our product offering also includes accident and health, general insurance and savings accounts. AEGON The Netherlands targets many customer segments through a sophisticated multi- channel distribution network. We recognize that in today’s world, customers – whether individual, corporate or institutional – demand high quality tailor-made products delivered with excellent service.  The steady gain in market share in the group pension business, the largest part of our activities in  the Netherlands, demonstrates this.  We have improved the transparency of our products and services, anticipating forthcoming legal and regulatory changes in the financial services industry in the Netherlands. That is what customers expect  from AEGON. Looking forward, there are significant long-term growth opportunities in our existing core markets.  For example, in the group pension market where we offer products and services in asset management, liability risk management and pension administration, bundled or unbundled, and also in the individual pension and income markets. AEGON GROUP ANNUAL REPORT 2003 18 Product strategy for the Netherlands life market Restructuring AEGON The Netherlands JOHAN VAN DER WERF MEMBER OF THE  EXECUTIVE BOARD AND  CEO AEGON THE NETHERLANDS INSIGHT