Five CEOs in seven years, a revolving door of senior leadership that is making rating agencies and the entire insurance industry wonder what is going on at Fireman’s Fund Insurance Co. Add to this the September 2014 decision by parent company Allianz to absorb the insurer’s commercial lines business, and something smells rotten in Novato.
Executive SummaryLeadership experts discuss the high cost of CEO turnover and the possibility of a parent-sibling culture clash between Allianz and Fireman's Fund in the wake of recent news from Novato, Calif. and Munich, Germany. There is an update to this article. See related article, Allianz Announces New Leadership for Fireman's Fund, AGCS NA Combo.
Now comes word that Allianz is considering “strategic options” for Fireman’s Fund’s personal lines insurance business. If this line also is absorbed, there goes an historic American insurance brand, founded in 1863 in San Francisco with the mission of providing 10 percent of its profits to the widows and orphans of firefighters killed in the line of duty—hence its unusual name.
Then again, one cannot dismiss the Novato, Calif.-based insurer, given its legacy of rising from the ashes. Through the decades, the Fireman’s Fund endured its share of setbacks, losing roughly $500,000 in claims from the Great Chicago Fire in 1871 and more than $11.2 million from the 1906 San Francisco earthquake. At the time, few believed the company would endure—its assets were estimated at a paltry $7 million.
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