Within two months of the Banking Royal Commission’s insurance hearings decimating Freedom Insurance, the company has announced that its chief executive, Craig Orton, would step down for personal reasons by the end of the year.
Orton, who received a grilling on Freedom’s sales tactics from Senior Counsel assisting the Commission, Rowena Orr, in the hearings, would be replaced by life insurance industry veteran Sean Williamson. Williamson was currently consulting to Freedom and would continue in this capacity until the handover.
Non-executive director, Katrina Glendinning, also resigned effective from yesterday and director David Hancock said he would resign effective from the end of the year.
Non-executive director of Mercer Superannuation Trust and Decimal Software, Pauline Vamos, would be put forward as a director and chair of the board at Freedom’s annual general meeting this Thursday, taking up the role immediately subject to shareholder approval.
In the face of this exodus from the firm, Freedom reported to the stock exchange that the board remained of the view that “significant value” remained within the company, including:
- A large in-force book;
- Administration and customer service operations to support these policies;
- Relationships with business partners; and
- The St Andrews opportunity.
Despite this, the company anticipated recording an EBITDA loss of $7 million to $8 million for the six months to the end of 2018, partially because of large restructuring costs incurred in its downsizing of staff and operating capacity in the wake of Orton’s Royal Commission appearance.