AMP Limited’s financial results and the actions of other owners of life insurance businesses have validated the company’s decision to sell its life insurance business to Resolution Life, according to AMP chairman, David Murray.
Murray used his address to the AMP Limited annual general meeting to defend the much-criticised sale decision stating that since the sale agreement in October “our financial results have reinforced that AMP is no the best owner of a life insurance business with higher capital requirements and earnings volatility”.
“Indeed, the recent sale of many major life insurance groups in Australia are also attributable to these factors,” Murray said.
“There has been some criticism of the transaction with Resolution Life,” he said. “As a Board we respect differing viewpoints, but we are bound to act in the best interests of the company and all shareholders, rather than satisfy the particular agenda of a view.”
“Life insurance is a very long-term business. Given we were faced with deteriorating prospects, a sale was the best option when considering the interests of the company over the long-term,” Murray said.
Elsewhere in his AGM address, Murray foreshadowed that AMP chief executive, Francesco De Ferrari would outline his position on the future of AMP at around the time of the company’s interim financial results in August.
“We expect by then to have a line of sight on completion of the sale transaction and clarity of relevant legislation post the federal election,” he said.