Zurich to withdraw from Australian group life insurance market
The decision follows an extensive review of its local group life business, conducted in light of the extremely challenging conditions facing the Australian group life market.
The phased withdrawal will see Zurich close its book to new mandates immediately, whilst continuing to provide cover and support to existing clients.
Mr Colin Morgan, CEO of Zurich's Australian Life and Investments business, said "we entered the local group life market in 2008, believing there was an opportunity for a specialist niche player to serve the smaller end of the market.
"However the landscape of the Australian group life market has now significantly changed and it is increasingly difficult for smaller players to offer a competitive proposition."
In making the announcement, Mr Morgan noted that the adverse claims experience of many large group life funds had been well documented, as had the significant flow on effects to premiums, reinsurance rates and reserving requirements across the overall group life market.
"The ongoing challenges have reinforced the need for scale in this highly specialised segment, and ultimately we felt we couldn’t participate in the local group life market in a way that was sustainable, either for Zurich or our customers," said Mr Morgan.
"This is in stark contrast to our retail life business, which continues to grow rapidly, reflecting the underlying health of the Australian market and the strength of our distribution partnerships."
Mr Morgan noted that this standalone decision was based on the commercial outlook for a specialised segment, representing a very small part of Zurich's Australian business, and does not affect other Zurich offerings in the market.
"Zurich remains very much committed to its Australian Life & Investments and General Insurance businesses", he said.
Staffing impacts will be limited, with only two roles immediately affected.
For further information contact:
Head of Marketing and Communications,
Zurich Life & Investments
Phone: +61 2 9995 1127
Zurich Insurance Group (Zurich) is a leading multi-line insurer that serves its customers in global and local markets. With about 55,000 employees, it provides a wide range of general insurance and life insurance products and services. Zurich’s customers include individuals, small businesses, and mid-sized and large companies, including multinational corporations, in more than 170 countries. The Group is headquartered in Zurich, Switzerland, where it was founded in 1872. The holding company, Zurich Insurance Group Ltd (ZURN), is listed on the SIX Swiss Exchange and has a level I American Depositary Receipt (ZURVY) program, which is traded over-the-counter on OTCQX. Further information about Zurich is available at www.zurich.com.