The Commonwealth Bank is selling CommInsure General Insurance to Hollard Group.
Camera IconThe Commonwealth Bank is selling CommInsure General Insurance to Hollard Group. Credit: AAP

CBA sells insurance business for $625m

Steven DeareAAP

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The Commonwealth Bank is offloading its general insurance business to the Hollard Group, which will be invited to spruik home and vehicle insurance to CBA customers.

Hollard will pay $625 million for CommInsure General Insurance, and through a 15-year partnership, gain access to widely-used bank channels such as the CommBank app to try and sell products.

The CommInsure General Insurance name will remain.

Hollard, in addition to making the initial payment, may also make deferred payments to the bank should insurance sales meet targets.

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The bank will continue to receive income from the sale of insurance products.

The bank's group executive retail banking services Angus Sullivan said the alliance would combine Hollard's products with the bank's app and branches.

The bank has been trying to better offer services to customers, particularly through digital channels.

In May, the Commonwealth bought stakes in online shopping group Little Birdie and power retailer Amber.

The bank will offer these online services through its banking ones as it tries to keep pace with fast-growing rivals such as Afterpay.

Hollard won the deal through a tender process. The sale is expected to be completed mid-2022.

Shares were lower by 5.24 per cent to $98.26 at 1605 AEST on Monday amid a wider market downturn.