NRMA buys State Insurance

Australia's largest general insurer has secured a beachhead in the New Zealand market, buying State Insurance from CGNU for $A325 million ($406 million).

State, which employs 1400 staff and has a 19% share of the general insurance market, made an $18.6 million profit in 1999 on total assets of $486 million.

The foray is the first for NRMA into New Zealand but managing director Eric Dodd said State was "a good strategic fit" with complementary people, products and culture.

The company planned to save about $10 million a year by changing the distribution and claims network. The acquisition is expected to be earnings positive within 18 months.

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