Kiwibank life insurance business sold to Australian insurer NIB

Monday, 8 November 2021

Kiwibank's owner has sold its life insurance company for $45 million to health insurer NIB.

Kiwi Group Holdings, which owns Kiwibank, set up Kiwi Insurance to provide insurance to the bank’s customers.

The deal includes a long-term partnership under which Kiwibank will refer customers needing insurance to NIB.

Kiwibank chief executive Steve Jurkovich said the sale of Kiwi Insurance was part of the bank’s growth strategy, which involved simplifying its business.

Kiwibank says it is the first bank to issue bank cards made out of recycled materials. The cards will be made in high-tech factories in Auckland and Australia.

* Kiwibank profits slips almost 20% despite increased business and home lending

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Rob Hennin, NIB chief executive, said there would be no change to policies for the 34,000 Kiwi Insurance policyholders as a result of the sale, Jurkovich said.

The sale was expected to complete early next year, subject to regulatory approval.

In the year to June 30, Kiwi Insurance earned $20m in premiums and made an after-tax profit of $379,000.

It sells term life, income protection, trauma and funeral insurance.

The sale is part of a trend in the banking industry. Westpac sold its life insurance company to Fidelity Life earlier this year.

BNZ sold its life insurance business to Partners Life last year, ANZ sold its life insurance business to Cigna in 2018, and ASB sold Sovereign to AIA in 2017.

Kiwi Group Holdings is owned by New Zealand Post (53 per cent), the New Zealand Superannuation Fund (25 per cent) and ACC (22 per cent).

NIB is an Australian insurance company whose shares are listed on the ASX sharemarket. In 2015, it bought ANZ’s health insurance business.