In a move pitched as giving its customers a wider and deeper range of bancassurance choices, the Commonwealth Bank of Australia is set to sell all its life insurance businesses in Australia and New Zealand to AIA Group Limited for A$3.8 billion. The sale agreement includes a 20-year partnership with AIA for the provision of life insurance products to customers in Australia and New Zealand, the CBA disclosed in via the ASX. Further, CommInsure Life and Sovereign customers will retain all the current benefits of their existing policies. Under the terms of the partnership, CBA will continue to earn income on the distribution of life and health insurance products."The transaction and partnership … will allow customers to have continued access to high quality life insurance products through Commonwealth Bank and life and health insurance products through ASB, with the addition of AIA solutions to our offerings," CBA announced yesterday.AIA is the largest independent publicly listed pan-Asian life insurance group and has well established businesses in Australia and New Zealand. The combined operations from this transaction will make AIA the life insurance market leader in both Australia and New Zealand.The sale price of $3.8 billion is a multiple of 16.9 times the businesses' 2017/18 pro forma earnings and 1.1 times the embedded value of CommInsure Life and Sovereign. A pre-completion dividend is also expected to be received by CBA, with the exact amount subject to the timing of completion, business performance and regulatory approvals. CBA's statement to the ASX disclosed that the transaction is expected to release approximately $3 billion of Common Equity Tier 1 capital and will result in a pro forma uplift to the Group's FY17 CET1 ratio of approximately 70 basis points on an APRA basis. The transaction is expected to result in an indicative after tax accounting loss on sale of approximately $300 million, net of separation and transaction costs.The sale does not include general insurance and the CommInsure brand will be retained. Further, it is subject to certain regulatory approvals in Australia and New Zealand and is conditional upon the transfer of CBA's equity interest in the BoComm Life Insurance Company Limited out of CommInsure, which itself is conditional on approval from the China Insurance Regulatory Commission.  The transaction is expected to be completed in calendar year 2018.