TAL have announced that they have entered into an agreement with Suncorp to purchase its Australian life insurance business including Asteron Life.
Suncorp has indicated that legally binding sale agreements are expected to be completed by the end of August with the total cost to be around $725 million. It is expected the sale will be completed by 31st December 2018.
TAL have confirmed that upon completion of the sale there will be no immediate changes and they will be maintaining the Asteron brand and products.
TAL (formerly Tower Australia) was purchased by the Japanese insurer Dai-ichi Life in 2011. TAL are currently Australia’s largest life insurance company with $2880 million in force premiums as at the end of March 2018 according to Strategic Insight. The Suncorp group, including Asteron Life, are currently ranked eighth in size with $813 million in force premiums.
This deal continues the trend over the last 2 years of banks divesting their life insurance businesses.
In September 2017 AIA announced it had entered into a deal to buy the CommInsure Life insurance business from the Commonwealth Bank. Following this in December 2017 Zurich announced it would be purchasing the OnePath life insurance business from the ANZ Bank after already successfully acquiring Macquarie Life from Macquarie Bank in 2016.
Michael Cameron Suncorp Chief Executive & Managing Director statement
Michael Cameron Suncorp Chief Executive & Managing Director said the sale of the life business would simplify Suncorp’s business model and provide a significant release of capital to shareholders. TAL and Suncorp will enter a 20-year strategic alliance agreement for the sale of life insurance products through Suncorp’s distribution network and Suncorp will continue to earn income from the distribution of life insurance through this agreement.
It is yet to see how this unprecedented consolidation of the life insurance industry will affect consumer premiums, following several years of hikes to income protection and trauma rates.
To compare premiums from Australia’s largest life insurance companies, including Asteron and TAL, go to Compare Quotes Online