Allianz Taiwan Life Insurance has agreed to sell a part of its traditional life insurance portfolio to China Life.
The deal includes a portfolio of about 78,000 policies with a guaranteed interest rate of 4% or higher. It has a combined International Financial Reporting Standards (IFRS) policy reserves of more than NT$42.1bn (€1.2bn).
The sale is part of Allianz’s strategy to manage its life insurance portfolio in the country with more capital-efficient solutions.
Upon completion of the transaction, Allianz expects to have a positive impact on its Solvency II capital position. The deal does not affect any of Allianz Taiwan’s employees.
As per the sale agreement, all the assets and liabilities related to the respective portfolio, along with full protection of customer interests and rights will come under the purview of China Life.
The transaction which is expected to be completed by the middle of next year, is still subject to approval from China Life’s shareholders and regulatory approval.
Allianz Asia Pacific regional CEO George Sartorel said: “With its strong balance sheet and track record in acquiring and integrating policies and policyholders, we believe China Life is the ideal candidate to take over this portfolio.
“Allianz remains fully committed to Taiwan, and this transaction is consistent with our priorities to serve customers with our core unit-linked and protection solutions.”
China Life stated that it will not have any trouble finding yields with NT$49.8bn in additional investible capital from the transaction.
Last year, Allianz Taiwan had tried to sell the same policies to Taiwan Life Insurance, a subsidiary of CTBC Financial Holding, but the deal was cancelled as it did not receive permission from Financial Supervisory Commission.
Image: Allianz to sell Taiwanese life insurance policies to China Life. Photo: Courtesy of Allianz.