About a dozen senior staff from Aegon UK will provide management capability and technical expertise for the launch of the joint venture.
The move is seen as an important endorsement of Aegon UK by its Dutch parent. The UK arm employs more than 4,000 people, mostly in Scotland.
Aegon announced a partnership with the leading Indian business Ranbaxy Promoter Group earlier this year to enter the insurance and asset management markets jointly in India.
The partnership will be implemented by Aegon UK and the Ranbaxy company Religare, which provides financial services across India.
The Indian life assurance market has trebled in size since it first opened up in 2000, but life assurance sales as a proportion of gross domestic product are relatively low, so it is seen as an attractive and fast-developing market for insurers.
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India’s increasingly wealthy middle class of 250m-300m people and the relatively high annual economic growth of 6-7% has made the country an attractive market for financial groups.
Aegon will enter a market in which the 14 life insurance joint ventures with foreign parties are continuing to close a historic gap with the market leader LIC.
Otto Thoresen, Aegon’s UK chief executive, is drawing together a programme management team, which will be responsible for developing the plan for the joint venture.