IAG buys CGU/NZI
News
The $A1.86 billion acquisition of CGU-NZI by Insurance Australia Group (IAG) puts into doubt the Preferred Repairer Program initiated last year by CGU Insurance and an extensive operational review at NZI. The deal also has huge ramifications for Suncorp Metway, the number two insurer in Australia, as well as the New Zealand market, where IAG now controls the largest (State) and third-largest (NZI) insurers.
CGU gives IAG a stronger general insurance base in Queensland, where its NRMA brand is still relatively small as well as rural Australia. In addition, CGU brings its relatively recently acquired Fortis Australia brands, including AIM and VACC Insurance.
The deal takes IAG's brand portfolio to nine brands in Australia, including NRMA, SGIO, SGIC, VACC and CGU and two in New Zealand; NZI, and the largest insurer, State Insurance.
Rumours that IAG has also acquired the Lumley Group surfaced as Paint & Panel went to press.
CGU & NZI: the facts
* Both CGU and NZI were previously owned by Aviva, one of the world's top ten insurers.
* The Australasian businesses had been operating autonomously, reporting to Aviva in the UK.
* The global merger of Commercial Union and NZI's parent company General Accident brought together CGU and NZI in 1998.
* CGU acquired Fortis' Australian operations in 2001.
* The two businesses have a combined gross written premium (GWP) of $A2 billion.
* CGU and NZI employ 3200 people in Australia and 650 in New Zealand.
* Over 70 per cent of CGU's GWP is sourced from Queensland, NSW and Victoria.
* NZI is New Zealand's third-largest insurer.
Risk management: get into it!
The Australian Accident Repair Network (AARN) and Global Compliance Systems have been working with NRMA Insurance to develop a risk management program which is tailored to meet the specialised needs of the smash repair industry.
The Diploma of Business (Frontline Management), accredited by Swinburne University of Technology, will help smash repairers identify and manage risks that have the potential to put them out of business, including modules on environmental awareness and safety in the workplace.
NRMA Insurance, group executive -- Personal Insurance, Rick Jackson, said the smash repair industry is one of the company's 'key business partners' and the program makes good sense.
"We are encouraging all smash repairers to take part in the course as it will help them become more successful in the long-term and help them protect community interests," Jackson said.
"As many smash repairers are small, family-operated businesses, the course is flexible and designed for minimal disruption to their business. Participants choose to attend a series of two-day classes within a year and apply their knowledge in the workplace so benefits can be realised immediately."
Smash repairers will gain best practice principles on how to better manage waste disposal, management of hazardous material, work practices, safety equipment and maintenance, and general housekeeping to prevent injuries related to slipping incidents, ventilation, and noise levels.
"We are aware of some inspirational thinking taking place that is delivering community benefits and financial rewards. One of our NSW Preferred Smash Repairers (PSRs) is now recycling approximately 70 per cent of his business's waste with innovative methods. This has achieved an 80 per cent reduction in waste disposal costs -- a win-win for his bottom line and the community.
"It is pleasing to see other Preferred Smash Repairers have already committed to participating in the program which will commence in late November," Jackson said.
The development of the course has been a joint effort between NRMA Insurance, AARN and Global Compliance in consultation with smash repairers for the past year.
For more information, contact Global Compliance Australia, tel: (03) 9548 1197, website: ww.globalcompliance.com.au
NRMA Insurance Workers Compensation claims research shows the main costs to smash repair businesses arise from injuries sustained in the workplace including back strains, eye injuries, and upper limb lacerations and bruising.
