Insurer poised to buy CBA life unit
AIA appears to be ramping up its expansion plans throughout Australasia, with the pan-Asian insurer said to be poised to buy Commonwealth Bank’s life insurance assets, worth about $4 billion.
It comes as AIA and Zurich lobbed final bids to buy CommInsure and the New Zealand Sovereign life business by the Thursday night deadline.
As flagged by The Australian’s Dataroom column, AIA was thought to be the most likely group to buy CommInsure.
Sources yesterday said they believed AIA had won the contest, as reported online, although those close to CBA did not comment.
It is thought CommInsure and the New Zealand Sovereign business are both being bought by AIA.
The attraction of CBA’s Australasian life insurance operations for AIA is believed to be the opportunity it provides to gain access to the bank’s client base.
AIA has been performing strongly in Australia, despite losing one account to BT Financial Group.
But the insurer is said to have been struggling recently to lift the performance of its Vitality loyalty program, and boosting its client base is thought to be a way to offer support.
AIA is understood to be working with Deutsche on the acquisition, while Zurich is with Credit Suisse.
US-based MetLife is believed to have shown some early interest in the New Zealand assets, taking advice from Morgan Stanley.
CBA has been working on the life insurance sale with adviser JPMorgan.
The bank is selling its CommInsure unit after it was investigated by the Australian Securities & Investments Commission over a number of issues.
ASIC this year investigated concerns CommInsure’s advertising and promotion of life insurance policies contained “potentially misleading or deceptive information” in the period before March last year.