New Zealand’s Tower will acquire a TSB-branded portfolio that is already underwritten by the insurer in a $NZ5.2 million ($4.7 million) transaction.

Tower will directly insure the TSB customers under 18,000 of its own branded policies following deal completion, expected at the start of next month. The policies will migrate to Tower's cloud-based digital platform.

The two companies have also entered into a referral agreement for new TSB insurance customers for five-years.

“This new acquisition follows the successful portfolio acquisitions of Youi NZ, Club Marine and ANZ that are delivering growth and efficiencies,” Tower CEO Blair Turnbull said.

“We have enjoyed a positive relationship with TSB over many years and are very excited to continue the relationship in its new referral form.”

Tower has provided insurance to the bank’s customers since 2004 and the TSB portfolio contributed $NZ11 million ($10 million) in gross written premium last financial year.

In February, Tower paid $NZ560,000 ($510,367) to Westpac to acquire all rights and obligations relating to a smaller legacy portfolio of policies issued to the bank’s customers.