The businesses being sold comprise Old Mutual's long-term savings and banking operations in Denmark, Norway and Sweden operating under the Skandia brand.
"The sale of Nordic to Skandia Liv represents a truly unique opportunity to create value for both Skandia Liv's policyholders and Old Mutual's shareholders through unlocking significant synergies from the combination of Skandia Liv and Nordic," chief executive Julian Roberts said.
Old Mutual said it expected to complete the sale towards the end of the first quarter of 2012.
Old Mutual has recently embarked on a programme of selling off businesses which it feels are no longer core parts of its operation.
It sold its American life insurance business to hedge fund Harbinger this year and remains keen on selling its stake in South African lender Nedbank (NEDJ.J).
Old Mutual investors have complained that the market value of the group, which runs banking, insurance and asset management operations in 33 countries, is below the combined standalone value of its businesses, weighed by a "conglomerate discount."