Medical indemnity mutual Avant Insurance is buying Doctors’ Health Fund (DHF) for $28.5 million.

The merger will create a client base of more than 65,000 members.

Avant Chairman Stuart Boland says the acquisition will bring many benefits to DHF members.

“By accessing Avant’s capital strength, we will have the support to grow and meet the challenges of this competitive and changing industry,” he said. 

The DHF brand will continue to be used. Avant reported a pre-tax profit of $116.4 million for the 2010 financial year, with $97.2 million coming from its medical indemnity business. DHF reported a pre-tax profit of $2.6 million for the same period.

Subject to members’ approval of the deal, the merger is expected to be completed before the end of this year.