IAG has renewed its largest Whole of Account Quota Share (WAQS) agreement with Berkshire Hathaway subsidiary National Indemnity Company (NICO), representing 20% of the total 32.5% WAQS program.
The renewed agreement – effective January 1, 2023, and ending on December 31, 2029 – means IAG has renewed 30% of the 32.5% WAQS, with Munich Re, Swiss Re, and Berkshire Hathaway.
IAG chief financial officer (CFO) Michelle McPherson said the renewal brings to IAG a materially consistent financial outcome to the original agreement and supports 15% to 17% of its medium-term reported margin target.
“Berkshire Hathaway is a key partner of IAG, and we are pleased to extend our strong relationship to the end of the decade,” she said.
However, the new arrangements will not include the strategic relationship agreement and the equity ownership subscription agreement, originally announced on June 16, 2015.
“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,” McPherson said.
IAG expects to complete the negotiations on the remaining 2.5% of WAQS in the coming months.