The reputed Allianz Global Corporate & Specialty (AGCS) will stop offering underwriting services in long-term financial risks here in Australia and NZ starting next September after performing a strategic review of its business operations.
AGCS noted in a statement that it would also cease its New Zealand operations for business lines like energy, property, entertainment, engineering and future alternative risk transfers required to be written beyond Australian borders.
The Board Member and Chief Markets and Regions Officer Sinead Browne explained that it was no longer viable and sustainable for the company to continue providing financial lines coverage in an environment where corporates continue to face an “alarming increase” in the class action lawsuits as well as litigation funders.
“The current rise in legal funders and the very challenging legal environment which is driving the extraordinary claims levels within our sectors make it untenable for AGCS to continually offer long-tail business in this Pacific,” she stated.
At the same time, AGCS introduced James Stack as the incoming AGCS Pacific CEO set to assume office from August 1, taking over from Willem Van Wyk who leaves Allianz.
The company further said 43 employees have been affected by these new changes which apply to various lines including the professional indemnity, officers’ and directors’ cover.
“AGCS will work closely with all the affected colleagues to effectively support them through this change while evaluating all possible options for redeployment,” Ms Browne told StormAssist.
In 2018, AGCS’ Australian long-tail financial business registered a whopping €42 million ($68 million) in gross written premium (GWP) which accounted for 0.5% of the company’s total global revenue of €8.2 billion ($13.3 billion).
In New Zealand, AGCS has a single branch with a team of four that posted €9 million ($14.6 million) of GWP in 2018.
AGCS has also appointed Joanna Mercer, previously the Head of Compliance and Product Development to take over the position of Head of claims for the Pacific starting October 1.
AGCS is a team embedded within Allianz Australia and continues to provide long-tail risks.
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