AIA Australia has welcomed CommInsure Life to its business as the joint cooperation agreement between the Commonwealth Bank of Australia (CBA) and AIA commenced today.
The joint cooperation agreement is an alternative completion structure for the purchase of CBA’s CommInsure, Colonial Mutual Life Assurance Society, and certain affiliated companies. The agreement includes a 25-year strategic distribution agreement.
AIA said the joint cooperation agreement would deliver strategic benefits for AIA by enhancing its competitive advantage in an underinsured Australian market.
AIA Group regional chief executive, Bill Lisle, said: “We are delighted to welcome CommInsure Life to AIA, and to commence our 25-year partnership with CBA.
Our partnership with CBA provides a unique opportunity to help people by addressing their financial, life and health needs, by bringing the best of both our organisations together to deliver truly differentiated, innovative propositions to the Australian marketplace.
“This is a special time for AIA in Australia, having celebrated the group’s 100-year history in Melbourne earlier this week, and today with the implementation of our joint cooperation agreement with CommInsure Life following on from our acquisition of Sovereign in New Zealand last year. This underpins our commitment to helping as many Australians as possible live healthier, longer, better lives.”
In an announcement to the Australian Securities Exchange (ASX), CBA said It had received an upfront payment from AIA of $500 million and the full economic interests associated with CommInsure Life, excluding the group’s 37.5% equity interest in BoCommLife Insurance Company, had been transferred to AIA.
It said AIA would obtain “an appropriate level of direct management and oversight of the business”.