Credit Union Australia will be rebranded as Great Southern Bank. Credit: Hush Naidoo on Unsplash.

HBF has acquired the health insurance business of Credit Union Australia’s (CUA) for an undisclosed sum.

The acquired unit, CUA Health, serves approximately 79,000 customers.

Concurrently, HBF also signed a five-year distribution agreement with CUA, which will soon be rebranded as Great Southern Bank.

Under the distribution agreement, CUA will sell HBF’s health insurance offerings to its banking customers.

HBF, which is a not-for-profit health insurer, expects the acquisition to scale up its business outside of West Australia (WA).

HBF CEO John Van Der Wielen said: “Acquiring CUA Health is a significant and compelling strategic move for HBF to further propel our national growth strategy, building on the strong organic growth we’ve seen across Australia since our bold advertising campaign launched nationally in 2020.

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“It will drive our membership base beyond one million, with approximately 17% living outside of WA, up from around 11% currently, and will provide us with great opportunities to grow our number of employees outside WA.”

The divestment of health insurance business is part of CUA’s strategy to shift focus primarily towards core banking business.

CUA CEO, Paul Lewis said: “This move allows both of us to focus on our core business and key strengths.

“CUA’s purpose is to help all Australians own their own homes. The money raised from this sale will increase our ability to achieve this and give us the opportunity to pursue growth options for our core banking business.”

HBF will be funding the acquisition with its cash reserves.

The deal is expected to be completed in the third quarter of 2021.