The Commonwealth Bank (CBA) has agreed to sell its Life insurance business in Australia and New Zealand to AIA. Under the deal the AIA Group will pay $3.8 Billion for the CommInsure Life and Sovereign businesses.
The deal is subject to regulatory and government approvals and is expected to complete in 2018. After AIA buys CommInsure it will be the number one ranked life insurance provider in Australia in terms of size.
The CBA have entered into a 20-year bancassurance partnership with AIA in Australia to ensure that their customers will still be able to access life insurance products. Existing CommInsure customers will retain all the current benefits of their existing policies and the CBA will retain the CommInsure brand.
The CBA Chief Executive Ian Narev stated that providing life insurance to its customers remained part of its core vision adding “the combination of AIA’s leading insurance capability and scale and Commonwealth Bank’s broad distribution, and our complementary values and commitment to customer focus and innovation, mean that a partnership between us will create an even better experience for our customers, in a more efficient way for our shareholders.”
AIA commented that the CommInsure life insurance business is an excellent to fit to its existing business and offers distribution opportunities to a customer base of over 13 million bank customers. AIA’s Group Chief Executive and President Ng Keng Hooi said “We look forward to welcoming our new customers and colleagues, and working with CBA to deliver innovative insurance products and services that meet the growing financial protection needs of customers across Australia and New Zealand”.