By , Published 21st September, 2017.
Sovereign’s parent company, the Commonwealth Bank of Australia (CBA), has today announced that it has agreed to sell its life insurance businesses in New Zealand (Sovereign) and Australia (CommInsure) to AIA Group Limited (“AIA”) for AUD $3.8 billion.
Under the terms of sale, ASB and CBA will enter into 20-year distribution agreements with AIA for the continued provision of life insurance products to customers in New Zealand and Australia respectively. Sovereign and ASB customers will retain all the current benefits of their existing policies, while benefiting from AIA’s worldwide expertise, innovation capabilities and commitment to its customers and distribution partners.
Sovereign CEO Nick Stanhope says: “This transaction represents the next exciting stage in Sovereign’s evolution. We are the product of several mergers and acquisitions of our own – so the prospect of becoming part of the AIA family, as our industry continues to consolidate globally, is an exciting prospect.
“We remain dedicated to providing our customers with the best products and service and we are confident that this will be a great fit for our customers, distribution partners, and our people,” Mr Stanhope says.
Stanhope adds: “Customers retain all their current benefits and this agreement does not affect their policies, benefits or service – it’s ‘business as usual’.”
AIA Group Chief Executive and President, Ng Keng Hooi, says: “The new long-term partnership will significantly expand our access to potential new customers and enable us to engage with them in a new way through CBA and ASB's extensive retail bank networks. We look forward to welcoming our new customers and colleagues and to working together with CBA and ASB on our shared objective of increasing life insurance penetration across the banks' 13 million customers in Australia and New Zealand.”
The transaction is expected to be completed in 2018, but is subject to certain conditions, including regulatory approvals in New Zealand, Australia and China.
For further information regarding CBA’s announcement to the ASX today, please click here: https://www.commbank.com.au/guidance/newsroom/ASX2-201709.html
For more information please contact:
Sovereign External Communications and CSR Manager