Zurich buys ANZ life business


By Sarah Kendell

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Zurich has purchased ANZ’s OnePath life insurance business for $2.85 billion as the global life insurer looks to rapidly expand its presence in the “mature Asia-Pacific” market and broaden its bank distribution partnerships.

The purchase price includes a $1 billion reinsurance commission to be paid by Zurich to ANZ, and upon completion of the transaction, Zurich will become the largest retail life insurer in the Australian market with 19 per cent market share.

The deal also includes a 20-year distribution agreement between Zurich and ANZ to provide white-label life insurance products for general advice customers, as well as retail insurance policies to be sold through ANZ’s salaried financial advice business.

Addressing a media teleconference yesterday, Zurich Asia-Pacific chief executive Jack Howell said the insurer was looking to deepen its presence in the Australian market with a focus on the increasingly important bank distribution channel.

“Bank distribution is increasingly important for life insurers and it is quite critical for us as a group – we access over 60 million customers through bank partnerships and this will be one of our largest globally,” Howell said.

“Australia is an advanced market with a large dynamic system for insurance and it is also underinsured by global standards, which provides an opportunity for increasing insurance penetration.”

ANZ group executive of wealth for Australia Alexis George said the bank was pleased to be able to provide customers with access to wealth products from a leading global life insurer.

“Zurich’s experience in working with banks around the world to provide insurance solutions, combined with its commitment to innovation and strong presence in Australia, is a good outcome for our customers, shareholders and distribution partners,” George said.

The purchase represented further expansion for Zurich in the retail life insurance space following the acquisition of Macquarie Life in 2016, however, Zurich chief executive of life and investments for Australia Tim Bailey said the growing scale represented an opportunity rather than a challenge when it came to providing quality service for advisers.

“With Zurich and ANZ both being committed to strong customer and adviser service, we are confident that working together we can ensure that is maintained through the period of integration and we are able to enhance it even further,” Bailey said.

Howell added: “We believe we are acquiring a healthy, well-run organisation, and the capabilities they have in combination with our capabilities will improve our ability to service advisers and customers and create a stronger organisation.”

The transaction is expected to be completed in November 2018, subject to regulatory approval.

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