Freedom Insurance Group has announced the immediate suspension of all direct insurance products with its managing director, Keith Cohen leaving the company immediately.
The company will also be reducing its staff to approximately 90.
In an announcement released to the Australian Securities Exchange (ASX) late today, the company announced the suspension at the same time as a restructuring of its business and changes to its senior management.
The announcement followed the company’s dramatic appearance before the Royal Commission into Misconduct in the Banking, Superannuation and Financial Services Industry.
The company told the ASX that as well as its suspension on direct insurance products it would be continuing to service and renew its is in force book of policies and would be restructuring its operations to align the business and staffing with its reduced activities.
The ASX announcement said that as a consequence of reduced business activities Cohel had left the company and had ceased as a director of Freedom "effective immediately" and that Craig Orton, who had been responsible for managing the company's operations since joining in February as Chief Operating Officer had been appointed as the new CEO.
It said that Freedom's Chief Financial Officer, Jenny Andrews, intended to depart the company.
The ASX announcement said that on implementation the intiatives were expected to reduce annual operating expenses by at least $15 million and that the company will incur approximately $4.8 million of restructuring.
"Following this business restructure, Freedom will continue to service its existing 350,000 customers whose policies will be unaffected by these changes," the ASX announcement said. "Freedom will continue to receive administration fees and trailing commissions from its existing in force policies."