QBE has taken one step forward with the appointment of Sue Houghton as the insurer’s Australian boss, but some concerns will linger until a full-time CEO is found.
UK-based Richard Pryce is acting chief now but has made clear he would prefer to retire sometime soon, which means he won’t be there for the long haul.
QBE earnings are roughly split in three parts between Australia, Europe and the US, so someone with international experience is clearly favoured.
But the middle of a pandemic is not a great time to hire a global insurance executive.
Houghton comes to the Australian job with strong credentials, most recently at Westpac which is in the process of selling its insurance assets having sold its general insurance to Allianz last year. Westpac’s life business is also on the blocks.
Houghton has also worked with IAG and Wesfarmers after starting her career with KPMG in London.
She beat the highly-regarded Frank Costigan to the job of CEO of the Australia and Pacific division.
Costigan, an insurance analyst by trade came to QBE via Youi and IAG, with a strong background in personal insurance.
He was acting head of Australia pending a search for a full-time executive after Vivek Bhatia left to join Link last year.
Former QBE boss Pat Regan was shown the door last year for alleged personal indiscretions.
QBE would like to grow the personal line business and would want to keep Costigan for that role.
QBE’s stock price underperformed the market by 38 per cent last year in the wake of the shock Regan departure, record low interest rates and a string of catastrophe claims globally.
Insiders hope this year may mark a turnaround for the company, which ended last year with yet another profit downgrade.
Acting boss Pryce is highly regarded by the market but analysts will be nervous until a new boss is cemented in the job, for fear he or she might take radical writedowns.
The Houghton appointment is a step in the right direction, but she won’t assume the job until August.
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