New Zealand Post-owned Kiwibank is to expand its insurance business to include life cover it has developed in-house.

The bank says it will offer lump-sum life, plus life and trauma cover.

A spokesman says a team in the Kiwibank’s insurance business will manage the underwriting and claims.

“Kiwibank has been involved in selling insurance to customers since 2002,” he told insuranceNEWS.com.au.

The bank sells home, contents, motor vehicle, travel cover and health insurance through outsourced providers.

“It is now moving to an in-group manufacturing model for some of the insurance products,” the spokesman said.

Tower handles some of the outsourced products, while Cigna Life NZ looks after credit card cover.

Marsh provides business insurance products for Kiwibank, while the bank’s firm Kiwi Insurance underwrites home loan cover.

Kiwibank CEO Paul Brock says the bank will sell the new life products through its branch network.

“We believe we can provide an offering sold through the bank that will be best value by comparison to some of those higher-cost packages available elsewhere,” he said.

“The main thing is that we want to simplify the life insurance product offering and make it very easy to buy.”

The expansion of the insurance business will see independent directors appointed to the company, which is a subsidiary of Kiwi Group Holdings.

The bank reported a $NZ79.1 million ($61.6 million) after-tax profit for the 2012 financial year and has more than 800,000 customers.