AIA Australia has won a massive group insurance contract, worth about $160 million in premiums a year, from Suncorp Life. 

The Sunsuper life insurance account has been up for review after Suncorp held the contract for 23 years.

The contract, starting on July 1 next year, will provide death, disablement and income protection for the superannuation fund’s 1 million members.

AIA CEO Damien Green says Sunsuper conducted a very comprehensive tender process.

“The fund has been working on a new insurance service model and a raft of product changes that we’ll be able to easily accommodate with our strong customer service focus and technological capability,” he said.

A Suncorp Life spokesman told insuranceNEWS.com.au the loss of the Sunsuper account would only affect the business by less than 2%.

“While our bid was very strong, we have always been clear that we would only want the business on a sustainable basis,” he said.

“Suncorp Life will continue to serve our other group life customers and we will review our strategy in the group life area focusing on opportunities and profitable, sustainable business.”

Sunsuper CEO Tony Lally says the fund has significantly redesigned its default insurance products to better align with members’ needs. 

“Our research highlighted that our members wanted the flexibility to tailor insurance cover over the course of their lives,” he said.

“We’ll now be able to meet these needs with a range of new life stage and aged-based insurance options.

“As part of the new arrangements, we’ll also introduce new premium rates that will offer better value for members, with each dollar of premium buying an average 38% extra death and disability cover.”

AIA will base some staff in Sunsuper’s head office to manage the fund and it has told insuranceNEWS.com.au it will be recruiting about 5% more staff to handle the new business.