* Targets 7-10 pct annual underlying earnings growth
* CEO says to cut costs, adjust prices
* To resume dividends with 0.10 euro payment over H2
* Shares up 0.8 pct, in line with European insurers index
(Adds analyst, CEO comments, details, shares)
By Aaron Gray-Block
AMSTERDAM, June 21 Dutch insurer Aegon said it would refocus on new markets, cut costs and adjust prices to convince investors it can aggressively target 7-10 percent in annual earnings growth after repaying state aid.
The Dutch government spent nearly 40 billion euros ($57 Billion) when it was forced to either nationalise or bail out several financial groups during the 2008 crisis, including ABN AMRO , bancassurer ING , Aegon and SNS Reaal .
Aegon became the first Dutch financial institution to repay the state in full earlier this month, repaying the government 4.1 billion euros ($5.9 billion), to allow a resumption in dividends and the possibility to make takeovers.
The company had earlier unveiled new targets in February with its fourth-quarter results and reiterated on Tuesday ahead of an investor meeting that it aimed to grow underlying earnings before tax by an annual 7-10 percent, on average, from 2010-15.
"We will get more details on how they are going to reach it (the target). This will be key to see whether the plans will ... be taken positively by the market. Will it be at the high or the low end of the target range?" RBS analyst Thomas Nagtegaal said.
KBC Securities analyst Dirk Peeters added, however, that Aegon's new targets seemed achievable.
French group AXA , Europe's second-largest insurer, is also seeking emerging market growth as it targets underlying growth of 10 percent in earnings per share.
Aegon intends to resume dividends this year, planning to pay a 0.10 euro dividend over the second half of 2011 in May 2012.
The life insurer and pensions provider said it would target growth in the Americas, primarily from variable annuities and pensions, alongside growth in Britain and new markets.
It is targeting a return on equity of 10-12 percent by 2015 and also aims to increase fee businesses to 30-35 percent of underlying earnings before tax by 2015.
"These are ambitious targets, but we believe we will be able to achieve them," Aegon Chief Executive Alex Wynaendts told broadcaster CNBC.
"We will be taking our expenses down more aggressively to offset higher costs due to the increase in longevity. Customers continue to need protection for longevity, which means the pricing which we are now going to be working with also has to reflect the new reality."
Shares in Aegon were up 0.8 percent, in line with the Stoxx 600 European insurers index
SNS Securities said now that Aegon has repaid state aid and restrictions on its strategy have been lifted, the company is expected to aggressively seek product innovation and adjust its pricing, while also focusing on boosting organic growth.
An Aegon spokesman said future pricing at Aegon, which had been shackled from competing while still on state aid, will take into account current interest rates and market volatility. This would involve price hikes and cuts, depending on the need. (Reporting by Aaron Gray-Block; Editing by Dan Lalor and Will Waterman) ($1 = 0.6971 euro)