After a 41 year run, CUNA Mutual Group is pulling its operationsout of Australia through a sale to an international insurance firmbased down under.

CUNA Mutual Group said it has reached an agreement in principleto sell its Australian business operations to QBE Insurance Group.QBE Australia is a member of the QBE Insurance Group, Australia'slargest international insurance and reinsurance group and one ofthe top 25 global insurers and reinsurers as measured by grosswritten premium, according to CUNA Mutual. QBE Australia has morethan 50 offices spanning each state and territory in Australia.

As part of its strategic review process, CUNA Mutual said itconcluded its Australian business would be better positioned toserve its customers and for future growth under a differentownership structure. The company has had business operations inAustralia since 1969, serving approximately 100 credit union andsimilar financial cooperative customers.

Part of the decision behind the sale had to do with CUNA Mutualacknowledging that it was having a difficult time building a motorand home insurance product base in Australia, said Faye Patzner,senior vice president, CUNA Mutual's head of internationaloperations and the company's chief legal officer.

“It's not a product we were good at there,” Patzner said. “Rightnow, in the United States, we partner with Liberty Mutual. We'renot sure we were providing a service when there were other betterplayers in the [motor and home] marketplace.”

Patzner said another motive for selling its operations inAustralia was because of the decline in credit unions in thecountry over the past 10 to 15 years. According to WOCCU, therewere 111 credit unions with a combined $42 million in assets andmore than 3.4 million members in Australia as of 2009.

About a year ago, Patzner said CUNA Mutual started looking at“others who could do it better” in Australia and began discussionswith QBE last summer. Both companies have signed the contracts andthe closing is scheduled for March 31. On closing day, QBE will ownCUNA Mutual's life insurance plans and motor and home plans willrenew through the firm. Almost all of the 84 employees will beoffered employment with QBE, Patzner said.

“Our Australian operation is strong and well-positioned forgrowth under QBE to leverage QBE's core strengths in the propertycasualty market and existing presence in the Australian market,”Patzner said.

CUNA Mutual's international operations in Europe and theCaribbean will not be affected by the Australian operationacquisition, according to the company.

“The European and Caribbean businesses provide CUNA Mutual asource of diversification at a time when our core U.S. credit unionmarket is facing industry and economic pressure,” Patzner said.

Over the past few years, CUNA Mutual has engaged in a number oftransactions. Last year, the company partnered with Esurance, adirect-to-consumer car insurance company with more than 500,000policyholders. In 2010, it also entered into an agreement withinstitutional investors to issue $85 million in fixed-rate, 20-yearsurplus notes to support its credit union market anddiversification strategies in an effort to drive more growth.

In 2009, it established a business development unit thatcompleted the purchase of CPI Qualified Plan Consultants, a 401(k)provider. That same year, it also acquired ProAg, a crop insurer itfirst partnered with in 2007. In the retirement services area CUNAMutual has said there are more opportunities to acquire books ofbusiness and fold them into its current business model.

Patzner said CUNA Mutual is constantly looking at opportunitiesand making adjustments with its 100-plus product portfolioincluding possibly exploring more acquisitions.