HIH Insurance Guide, Meaning , Facts, Information and Description

HIH Insurance is a defunct Australian insurance company. Its failure has been the subject of much controversy and a royal commission.

Table of contents

1 History 2 Collapse 3 Royal Commission

History

HIH Insurance was founded in 1968 by Ray Williams and Michael Payne and at this time it was known as "M W Payne Underwriting Agency Pty Ltd". It was acquired in 1971 by British company CE Heath PLC and Ray Williams was appointed to the board of CE Heath PLC in 1980. The business operations of this CE Heath PLC were transferred to "CE Heath International Holdings Ltd" in 1989 and CE Heath PLC retained 90% ownership of CE Heath International Holdings. In 1992, CE Heath International Holdings floated on the Australian Stock Exchange.

In 1995, CE Heath International Holdings acquired CIC Insurance Group and the remaining 48% holding that CE Heath PLC maintained in CE Heath International Holdings was sold to an offshoot of CIC Insurance Group called CIC Holdings Limited. CIC Holdings increased its share in CE Heath International Holdings to 50% and CIC Holdings was purchased by Winterthur Swiss Insurance Company (Winterthur Swiss). In May 1996 CE Heath International Holdings changed its name to HIH Winterthur.

Through 1997 and 1998, HIH Winterthur acquired a large number of companies both in Australia and globally, including Colonial Ltd General Insurance's operations in Australia and New Zealand, Solart in Argentina and Great States Insurance Co in the United States. Most notably however, HIH acquired the large Australian insurance company FAI Insurance. Winterthur Swiss sold its 51% share in HIH Winterthur to the public and HIH changed its name to HIH Insurance Ltd.

Collapse

Royal Commission

The royal commission into the failure of HIH was headed by Justice Neville Owen of the Supreme Court of Western Australia. At the first sitting of the royal commission, in Sydney in September 2001, Justice Owen stated that, "the critical point of the terms of reference is "the reasons for and the circumstances surrounding the failure of HIH". The remainder of the terms of reference flows from this point of the Commission's inquiry".

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