2 Jul 2013

Tower appoints new chief executive

1:18 pm on 2 July 2013

Insurance company Tower has appointed director David Hancock as its new chief executive, to replace Rob Flannagan.

Mr Hancock has more than 25 years of experience in the financial services industry and was formerly an executive general manager at Commonwealth Bank of Australia.

He who has been on Tower's board since November and is taking up the position immediately although Mr Flannagan will stay on for a short period to ensure a smooth transition.

Mr Hancock will be paid a base salary of $750,000 a year, with a short-term bonus of up to $500,000 a year if he meets performance measures set by the board and an unspecified long-term incentive based on the company's share price and profit performance.

Tower will also reimburse Mr Hancock for the costs of relocating from Australia to New Zealand and for his repatriation once his two-year contract ends.

Tower's current market value is $404 million, before the planned $114.5 million return to shareholders from the proceeds of the sale of its life business.

In the last few months, Tower has also sold its health and investments businesses and it is left with its general insurance business.

It has about 4% - 4.5% of the general insurance market and that business earns about $25 million a year.