DWS Vita SpA had technical reserves of more than $1.4 billion and net written premiums of $50 million in the first six months of 2007, the Swiss insurer said.
"The acquisition of DWS Vita reinforces our strong global partnership with Deutsche Bank," Paul van de Geijn, who heads Zurich's life operations, said in a statement.
The new Zurich entity would enter into an agreement with Finanza & Futuro, Deutsche's network of financial advisers in Italy, to distribute products.
Zurich has made a string of modest acquisitions this year, including German car warranty insurer Real Garant Versicherung AG, Ireland-based Wrightway Underwriting Limited, and OOO Nasta Insurance in Russia in February.
Life insurance is seen as providing much-needed growth to the sector, as prices in mature property and casualty insurance drop amidst intensifying competition.
Zurich said it was buying the group through its subsidiary Zurich Investments Life SpA (Italy), and the seller was an Italian subsidiary of Deutsche Bank.
The transaction was expected to close in the first half of 2008, pending regulatory approval.