Commonwealth Bank has completed the divestment of its life insurance business to AIA Australia, which includes a 25-year joint co-operation agreement.
After more than two years of negotiations, CBA said it has received an upfront payment of $500 million from AIA and the full economic interests associated with CommInsure Life have been transferred to AIA.
The deal excludes the banks 37.5% equity interest in BoCommLife Insurance Company.
CBA said under the new agreement AIA will "obtain an appropriate level of direct management and oversight" of the business.
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Colonial Mutual Life Assurance Society, the key life insurance entity of CommInsure Life, has also implemented reinsurance arrangements that are expected to result in a distribution to CBA in the first half of FY2020.
CBA chief executive Matt Comyn said: "We are excited by the opportunity to bring together the strengths of AIA and CommInsure Life and are working hard with our partner to develop a new generation of products for CBA's customers, which will deliver excellent customer outcomes."
The revised transaction path was announced in August this year, with CBA saying the commencement of the joint co-operation agreement "represents an important first step" for the planned divestment.
"The steps towards an ultimate completion of the share sale or statutory asset transfer continue to be progressed in line with previous announcements," the bank said.
The planned divestment has been subject to ongoing regulatory approval processes, which has led to an extended period of uncertainty for the divestment.
CommInsure has also been embroiled in a lawsuit filed by ASIC in October this year.
The regulator filed criminal charges against the CBA-owned company over its selling of life insurance through unsolicited phone calls to customers.