WRAPUP 1-Aegon, Aviva bolster risk hedges, EU insurers gain

By Reed Stevenson AMSTERDAM, Oct 9 (Reuters) - European insurance shares rose sharply on Thursday, as Dutch insurer Aegon (AEGN.AS: ) announced steps to boost capital and reduce risk while British peer Aviva Plc (AV.L: ) bolstered its hedges against slumping stock markets. Aegon, which has seen its share price sliced in half since the global credit crisis intensified in September, projected a 275 million euros ($374.7 million) third quarter charge on credit impairments, a figure one analyst described as "not extraordinary". Aviva said it would protect itself from stock market falls through increased hedges, and that a further 40 percent fall in equity markets would reduce its surplus regulatory capital by 700 million pounds ($1.2 billion), compared with an estimated drop of 1.3 billion as of June 30... [read full story]