The sale of the UK company, which has 300,000 policyholders and pounds 6.4bn under management, has been hastened by action taken by the Canadian regulatory authorities to liquidate Confederation Life, a mutual and Canada's fifth-biggest insurer, with pounds 14bn of assets.
Quentin de la Bedoyere, Sun Life of Canada's vice-president of product management, said: 'At one time our parent company was in negotiations to buy the entire Canadian company; that never materialised. We have been in serious negotiations to buy the UK company for the past six weeks.' Sun Life of Canada is one of its country's biggest life insurance companies.
The deal will have to be approved by the regulatory authorities in Canada and the UK, which may take two months. About 30,000 of Confederation Life's policyholders in Britain are directly registered with the parent company in Canada. One of the conditions of the sale was that Confederation Life in Canada would release sufficient assets to cover these policyholders' liabilities and allow them to be transferred to Sun Life of Canada.
In the UK, Sun Life of Canada and Confederation Life sell life and pensions products through direct sales. Confederation Life employs about 1,600, including a 700- member direct sales section working from 40 branches. Last year it made a profit of pounds 27m compared with a group loss of pounds 73m. About pounds 2.8bn of funds under management are company pension schemes. It also has bank holdings of pounds 310m.
Sun Life of Canada in the UK has about pounds 3.9bn under management with a sales force of 1,000.Reuse content