AMP will sell its Australian and New Zealand wealth protection and mature businesses to international insurance and reinsurance group, Resolution Life Group Holdings.
The A$3.3 billion deal is expected to be completed by the second half of 2019.
A binding agreement with Swiss Re to reinsure New Zealand retail wealth protection will release additional capital of up to A$150 million to AMP, prior to completion of the sale.
This agreement is expected to be effective from 31 December 2018 and will cover approximately 65 percent of the New Zealand retail wealth protection portfolio for new claims incurred from that date.
The announcement of the sale was made in a coordinated release in both New Zealand and Australia, which also detailed the wealth giant’s intentions to divest its New Zealand wealth management and advice businesses via an Initial Public Offering process in 2019.
In the release announcing its sale, AMP New Zealand’s Managing Director, Blair Vernon, commented, “AMP New Zealand is a highly efficient, well-run business which has been a consistent contributor to AMP. A strong team with a history of consistent delivery for all stakeholders has prepared AMP New Zealand for this significant change.”
Vernon noted New Zealand policyholders will retain all terms and conditions of their existing policies, “…so there’s nothing they need to do.” He added there are no changes for AMP New Zealand’s wealth management or general insurance clients, including members of the AMP KiwiSaver Scheme.
Vernon confirmed that AMP is communicating with all its customers in relation to today’s announcement.
Resolution Founder and Resolution Life Executive Chairman, Sir Clive Cowdery, said, “Over 15 years and the acquisition of 27 life insurance companies, Resolution has developed an operating model which puts delivering policyholder benefits to existing customers at the centre of our business.”
Click here for further details on changes to AMP’s business.