Citigroup Inc. will seek bids from global insurers to sell general insurance products across 12 Asia-Pacific markets, including Australia, in a multi-year bancassurance deal that could be worth at least $500 million, a source told Reuters
The deal for products, such as motor, property, and travel insurance, will give insurers access to Citibank’s 15 million customers in the region.
The process for the 15-year deal will commence in a few days, the partner for which will be selected in a few months, said the source who refused to be identified as the information was not public, the report said.
The non-life insurance deal, expected to be pitched to insurers including AIG and Allianz, will have its exact value depend on various issues including how upfront payments will be structured and how net present value of future commissions and deferred payments will be calculated.
The move follows a 2013 multi-year deal with insurer AIA to sell life insurance through the bank’s Asia network.
“The bank has invested a lot to grow its technology platform and digital engagement over several years. The idea now is to complement the life insurance partnership with another one for general insurance,” the source told Reuters
According to the source, Citi initially preferred one partner for all markets, but is also considering more than one given the range and scale of the bank’s retail platform.
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An American multinational investment banking and financial services corporation plans to leverage its network of branches and customer base as it seeks bids for a general insurance distribution deal for the Asia-Pacific market.