AIA Australia has now fully completed its integration with CommInsure Life, the life insurance unit previously owned by Commonwealth Bank of Australia (CBA), and here AIA Australia and New Zealand chief executive and managing director Damien Mu (pictured) shares what’s ahead for the wider operations.
It was back in 2017 when AIA Group agreed to snap up CBA’s life insurance businesses – CommInsure Life (formally known as The Colonial Mutual Life Assurance Society) in Australia and Sovereign Assurance Company in New Zealand – for $3.8 billion.
Full legal completion of the CommInsure Life swoop involved a Part 9 portfolio transfer in accordance with the Life Insurance Act 1995, with the statutory asset transfer to AIA Australia taking effect in April this year. Meanwhile, just recently, all CommInsure Life staff came onboard the same digital systems used by their AIA peers.
“This represents the final step in our integration journey to bring together Comminsure Life and AIA Australia,” Mu – who was named Insurance Leader of the Year 2021 at the 17th annual ANZIIF (Australian and New Zealand Institute of Insurance and Finance) Australian Insurance Industry Awards – told Insurance Business.
Read more: AIA agrees $3.8 billion CBA insurance deal
“We had thousands of employees and hundreds of different processes and systems that needed to be integrated. The successful completion means that we can now be a faster, simpler, and more connected business, and deliver a better experience for our staff, customers, and partners.”
The CEO went on to describe the completion of the transaction as an exciting milestone, in addition to them already feeling “like one big family” for some time.
Mu stated: “The collaboration leading up to and since completion has been inspiring as all staff have been driven by our collective dream to champion Australia to be one of the healthiest and best protected nations in the world.
“In July, we announced that later in 2021 we will launch our new advice business AIA Financial Wellbeing. This is an exciting expansion of our partnership with the Commonwealth Bank of Australia and will allow us to enhance the financial wellbeing of Australians through the provision of life insurance, superannuation, and wealth advice.”
As previously reported, the deal with the lending giant includes a multi-year strategic bancassurance tie-up with the pan-Asian life insurance group. In New Zealand, meanwhile, CBA’s offloading of Sovereign to AIA was finalised in 2018.
In June 2021, in a separate transaction in Sydney, the same bank sold CommInsure General Insurance to the Hollard Group. The sale was part of a series of insurance divestment by lenders. Allianz Australia, for instance, completed its purchase of Westpac Banking Corporation’s general insurance operations middle of this year.
“The [Australian] financial services industry has gone through a lot of change and reform in recent years,” Mu told Insurance Business. “This has been challenging, but also has served as an important prompt for organisations to consider their priorities and key objectives. With retail banks focussing on their core business, this presents an ongoing opportunity of insurers to grow, and expand their products and services for all Australians in the process.”
When asked whether the life insurer is looking to make further acquisitions, the chief executive offered a less-than-direct response.
He said: “At AIA Australia, we are driven by our purpose to make a difference in people’s lives. Our focus up until this point has been ensuring that we can deliver the best possible outcomes to our customers, existing and new. We are energised by the possibilities for the future and are excited to see what’s in store.”
Meanwhile, on AIA Australia’s website, it is noted that products previously sold under the CommInsure Life brand are closed to new business except for policyholders exercising continuation options and clients entitled to replacement policies. Existing customers can also still increase, decrease, or add options, and continue to receive product improvements.
As for what lies ahead, Mu had this to say: “Like most of the industry, our focus for the last two years has been on helping our staff, customers, and partners survive, revive, and thrive. With the easing of restrictions across the nation and increased vaccination rates, we can now look to the future.
“There is a growing insurance gap that represents an opportunity for us to consider how we can get the best possible products into Australians’ hands. This will increasingly involve the use of technology, to engage, educate, facilitate the sales process and then support our customers throughout their lives and any claims.”
