The mutual will increase AUM from £2.4bn to over £5bn with members rising by 127,000 to approximately 700,000.
Canada Life decided after to transfer the book to Scottish Friendly after a review and tender process.
The move will see Scottish Friendly take over Canada Life clients owning endowments, whole of life policies, investment bonds, pensions and protection policies, mostly written before 2003.
Scottish Friendly has acquired a number of books of insurance business including from Mobius Life in 2018, as part of a strategy to diversify and grow.
Jim Galbraith, chief executive of Scottish Friendly, said: “This is a landmark acquisition for Scottish Friendly and helps to consolidate us as a leading mutual and a significant player in UK financial services.
“It forms part of our three-pronged strategy of organic growth, business process outsourcing for partners and mergers and consolidation.”
Richard Priestley, managing director, Insurance Division, Canada Life UK, said: “This is an excellent move for both organisations, for Scottish Friendly by increasing their scale and for Canada Life to concentrate its resources around its core business strategy.”
Scottish Friendly has roots dating back to 1862 and was originally established as the City of Glasgow Friendly Society. It changed its name changed in October 1992 when it took over Scottish Friendly Assurance.