LV= has agreed terms with the Teachers Provident Society, which trades as Teachers Assurance to take over the majority of its business, due to be completed in early 2016.
Both Teachers Assurance and LV= are mutual friendly societies, Teachers Assurance provides financial products and services tailored to those working in education.
Members of Teachers Assurance will become LV= members and be able to use LV='s member benefits including free legal advice and a member support fund.
Teachers Assurance products include life, pensions, general insurance and savings and investments products, and is based in Bournemouth.
The acquisition is to be made under the Friendly Societies act and is LV='s most recent acquisition having bought Highway Insurance in 2008 and both Britannia Rescue and Tomorrow in 2007.
Teachers Assurance manages around £1bn of assets with its life and pensions business covering 32,000 policies, while its with-profits business covers 40,000 policies and its home & buildings insurance covers 13,000 policies.
The unit trust business of Teachers Assurance will be transferred to Threadneedle Investments and has 19,000 policies.
The vote of Teacher Assurance members is scheduled for 2015 and will be managed by Teachers Assurance.
Mike Rogers, group CEO at LV=, commented: "We believe Teachers Assurance offers good value to our members and is complementary to our existing business lines where we already have significant scale.
"This acquisition is further demonstration of our continued financial strength and will help with our strategic intention to continue to grow the life part of our business.
Rogers added: "We already have plans to launch a financial advice service to the teaching profession following this deal.
"Teachers Assurance, like LV=, has its head office in Bournemouth and as a result we hope to be able to redeploy many Teachers Assurance employees into the wider LV= group when, subject to member and regulatory approval, it becomes part of LV= in early 2016.
"We expect the deal to be earnings and cash flow positive within 12 months of completion and the impact on surplus capital is not material. We will be working closely with the current executive team over the coming months to ensure a smooth handover."