Former Promina Boss Joins Iag Senior Ranks

Sydney Morning Herald

Saturday December 15, 2007

Danny John

THE transformation of Insurance Australia Group into a clone of its one-time rival Promina - now in the hands of Suncorp - has continued with the appointment of another senior executive to its top management ranks.

Duncan West, who previously headed Promina's Vero division and missed out in the management merry-go-round that followed Suncorp's $7.9 billion acquisition of the former NSW-based insurance giant, is to become head of IAG's commercial business, CGU.

Mr West joins his former boss Michael Wilkins, who became chief operating officer at IAG a fortnight ago and is now No. 2 to the chief executive, Michael Hawker.

The appointment of the former Promina chief executive was prompted after a successive drop in annual profits for IAG - best known for its NRMA Insurance brand - which led to an alarming share price drop, and called into question Mr Hawker's hold on the top job.

Mr Wilkins's job gives him day-to-day charge of all of IAG's Australian insurance businesses while Mr Hawker concentrates on its overseas expansion.

The move took some of the immediate heat off Mr Hawker. But investors also believe it gives the IAG board, headed by James Strong, the ready-made option to propel Mr Wilkins into the chief executive's post if the market loses faith with the incumbent boss over the coming months.

While Mr West's appointment was announced by Mr Hawker in a statement yesterday, analysts indicated that it was equally likely that Mr Wilkins had a say in the decision.

Mr West, a 20-year veteran of the old Royal & SunAlliance group that became Promina, will report to Mr Wilkins in his new job. "Duncan is well known and highly regarded within the insurance industry," Mr Hawker said. "His depth of experience and proven leadership qualities make him a valuable addition to our organisation."

Mr West had been in line to become Promina's chief financial officer before Suncorp launched its agreed takeover offer last year. He left the merged company in March after the existing Suncorp finance director, Chris Skilton, was reappointed to the chief financial officer's role.

IAG has been similarly ruthless in making room for Mr West by ousting the head of its commercial insurance operations, Mario Pirone, who is leaving the group after nine years, three of which were in his latest job.

Mr Pirone has faced a difficult period in recent months after fierce competition in the commercial market resulted in a fall in divisional profit margins, causing IAG to stop writing a large contribution of loss-making cover.

IAG said Mr Pirone had decided to leave the group to pursue other opportunities. He was praised by Mr Hawker for having a "very successful" career with IAG.

IAG shares fell 6c, to $4.33, yesterday.

© 2007 Sydney Morning Herald

Back to News Index | Back to Home