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UPDATE 2-Australia's CBA to sell life insurance unit to AIA Group for $3 bln

* CBA $3.05 bln sale follows NAB's life insurance sale

* ANZ, Westpac said to be considering similar moves

* Australia life insurance facing higher payouts, scandals (Adds analyst comment, shares, other life insurance sales)

SYDNEY, Sept 21 (Reuters) - Commonwealth Bank of Australia said on Thursday it had agreed to sell its life insurance arm to Hong Kong's AIA Group Ltd for $3.05 billion, in the biggest Asian buyout of an Australian financial services firm.

CBA also flagged a possible wealth management IPO as Australia's major lenders come under regulatory pressure to boost capital in the face of a frothy property market.

The sale of insurance business CommInsure follows damaging media revelations last year that it had used discredited methods to refuse legitimate payouts, leading to policy cancellations.

The scandal was one of a series of crises that has rocked CBA in recent times, culminating in allegations of systemic breaches of money-laundering and terror-financing laws that could expose it to billions of dollars in fines.

"CBA has done well selling CommInsure on a good multiple," Shaw and Partners analyst David Spotswood said in a note to clients, adding it gave the bank "flexibility" in the event of hefty fines stemming from the money-laundering civil case.

CBA shares rose as much as 0.5 percent in morning trade while the broader Australian market was down 0.7 percent. It was rare respite for CBA shareholders, with the stock down 9 percent since the money-laundering allegations broke on Aug. 3.

The CommInsure sale is part of a broader trend of asset sales across Australia's banking sector. Asian life insurers are potential buyers due to Australia's growing population and economy, and its stable regulatory regime compared with emerging markets.

National Australia Bank Ltd sold an 80 percent stake of its life insurance unit to Japan's Nippon Life Insurance Co last year.

Australia and New Zealand Banking Group has said it may sell its life insurance and wealth divisions, while Westpac Banking Corp also has started exploring a possible life insurance sale, according to reports in the Australian media.

Under the AIA deal, CBA said it would continue to sell life insurance for the world No. 2 life insurer for 20 years, and customers would keep their existing benefits.

The Australian lender also said it was considering spinning off asset management business Colonial First State Global Asset Management in an initial public offering. Colonial has A$219 billion in assets under management.

CBA did not give further details about the plan but said its wealth management chief executive, Annabel Spring, would leave the company in December.

($1 = 1.2452 Australian dollars)

(Reporting by Sandhya Sampath in Bengaluru; Editing by Byron Kaye and Stephen Coates)