Australian Unity has confirmed a merger with fellow financial services mutual Lifeplan after more than 98% of Lifeplan members voted last week in favour of the proposal.

The merged mutuals will operate under the Australian Unity brand while the Lifeplan brand will remain on combined investment bond, funeral bond and education savings plan business.

Australian Unity controls funds under management worth more than $6 billion while Lifeplan has around $1.5 billion under its control.

"The overwhelming member support reflects something we always felt was a very sound idea," Australian Unity Group Executive of Investments David Bryant told insuranceNEWS.com.au.

"Investment markets are still very volatile and capital is restricted, and as a collective we will be able to do things more effectively and take advantage of opportunities much more readily."

The merger will be effective from August 31 subject to final court approval. Terms of the deal were not disclosed.

The combined organisation will have a customer base of 560,000 with offices in Melbourne, Brisbane, Adelaide, Perth and Sydney.

Australian Unity said the merged entity "will be an organisation of even greater strength, making it well positioned for future growth".