IAG renews largest quota share agreement with Berkshire Hathaway
Australian insurer IAG has renewed its largest Whole of Account Quota Share (WAQS) agreement, with National Indemnity Company (NICO), a subsidiary of Berkshire Hathaway.
IAG has agreed terms to renew the agreement with Berkshire Hathaway’s NICO, which represents 20% of the total 32.5% WAQS programme. The renewed agreement, effective 1 January, applies until the end of December 2029.
The Strategic Relationship Agreement and the equity ownership Subscription Agreement, originally announced in June 2015, will not be continuing under the new arrangements.
IAG has now renewed 30% of the 32.5% WAQS, with Munich Re, Swiss Re, and Berkshire Hathaway, all effective January 1, 2023, with negotiations on the remaining 2.5% expected to be completed in the coming months.
IAG chief financial officer Michelle McPherson said: “Berkshire Hathaway is a key partner of IAG and we are pleased to extend our strong relationship through to the end of the decade.
“The Berkshire Hathaway agreement delivers IAG a materially consistent financial outcome to the original agreement and supports our 15% to 17% medium-term reported margin target.”
McPherson added: “The terms of the renewed agreement with Berkshire Hathaway’s NICO reflect the maturing of our partnership, and the removal of supporting Subscription and Strategic Relationship Agreements provides consistency with our other quota share partner arrangements.”
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