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October 18, 2010updated 13 Apr 2017 8:51am

Virgin and TOWER join forces in Australia

British entrepreneur Richard Branson is to take on the challenge of breaking into Australias competitive life insurance market in early 2011 Using the existing Virgin Money base in Australia, the assault will be in partnership with Australian life insurer TOWER Australia Group (TAG). Virgin Money Australia MD Matt Baxby said: "Our new partnership with TOWER Australia is good news for the insurance sector and better news for Australian consumers

By LII editorial

British entrepreneur Richard Branson is to take on the challenge of breaking into Australia’s competitive life insurance market in early 2011.

Using the existing Virgin Money base in Australia, the assault will be in partnership with Australian life insurer TOWER Australia Group (TAG).

Graphic showing new business won by Tower Australia Group from 2008 to 2010Virgin Money Australia MD Matt Baxby said: “Our new partnership with TOWER Australia is good news for the insurance sector and better news for Australian consumers.

“Combining TOWER’s unquestionable reputation and infrastructure with the Virgin brand, we will be delivering a straight-talking, great-value product which is what people have come to expect from us.”

He continued that there is a lot of opportunity for Virgin Money in the life sector given that research shows that 95% of Australian families in Australia do not have adequate insurance cover.

In teaming up with TAG, Virgin Money has aligned itself with one of the country’s most ambitious insurers.

The only specialist life insurance company listed on the Australian Securities Exchange, TAG has in-force premium of more than A$1bn ($960m) giving it an 11% market share, the fourth-highest in Australia.

TAG has recorded a 15% CAGR in in-force premium over the past 15 years and provides cover to some 2.5m people.

TAG has also attracted the interest of Dai-ichi Life, the second-largest life insurer in Japan.

Dai-ichi made its first move in September 2008 when it acquired a 29.7% stake in TAG from UK investment company Guinness Peat Group for A$376m.

Dai-ichi followed this up in March 2010 when it gained regulatory approval to increase its stake in TAG to 49.9%.

TAG is itself on the acquisition trail and is reported by Australian media to have made a NZ$118m ($87m) takeover bid for New Zealand life insurer and retail asset manager Fidelity Life.

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