Australia, Features

UAA celebrates 50 years in business

2022 sees Underwriting Agencies of Australia (UAA) celebrate 50 years of being the number one provider of insurance for the crane and mobile plant and machinery sectors. A key element of the 50th birthday celebration sees UAA as the Platinum Sponsor of this years’ Crane Industry Council of Australia (CICA) National Conference and Exhibition.

From nothing to $450 million per annum in 50 years, the growth of UAA has been exceptional. With a growing global footprint, and celebrating 50 years in business, UAA recently made another major announcement that it had agreed to merge with MECON Insurance, a construction and plant and equipment specialist in the Australian market.

The history of UAA starts with humble beginnings in 1972 as Sanderson Insurance Brokers based in Newcastle, founded by Phillip Duncan. As an insurance brokerage, it was identified that sourcing specialised crane insurance for customers was difficult and further investigation identified a need to develop a product for our Australian crane industry. 

Phillip Duncan packed his suit and flew to England to visit the global insurance market Lloyds of London, to see if he could source a product for crane insurance. He found a syndicate with a very basic product that developed into Contractors Plant Insurance (CPI) in Australia and went on to build an incredible relationship with Lloyds of London. 

There was an aspiration to further develop this product and further service the needs of the entire insurance Australian industry through a broader distribution and a specialised underwriting approach that assessed and correctly priced the risk. To do this it was identified that the next step was to become a recognised niche underwriting agency that specialised in crane and machinery insurance and to utilise the national insurance brokers network to distribute the product to their clients. 

In 1988, UAA was born, maintaining a strong relationship with the Lloyds of London syndicate who provided the security that backed UAA. This meant that UAA was able to autonomously underwrite their own crane and machinery risks, and importantly also allowed to manage claims and service their customers. UAA became the first niche underwriter in its class to pioneer such a specific product in the Australian market.  

The product continued to develop and grow over the years into the industrial special plant (ISP) cover customers are accustomed to today that expanded to seven sections in order to adequately cover the exposures associated with mobile plant and equipment across a wide variety of industries. These sections now include: 

1.  Material damage (accidental damage), to 

2.  Hired in plant 

3.  Additional benefits such as auto multi lift covers, damage to lifted goods, recovery costs (damage or no damage), etc

4.  Financial Protection such as; loss of revenue, increase cost of workings, lease protection and lease gap protection 

5.  Breakdown cover 

6.  Road risk liability to third-party property – for road registered machines

7.  Broadform liability – covering personal injury, property damage and products liability associated with declared activities of a client’s business, not just when in operation with a machine as a tool of trade. 

UAA’s Head Office is in Newcastle, the birthplace of the UAA business

In 1988, UAA followed the mining industry and opened its second office in Perth, followed by Brisbane, Melbourne and Adelaide. 

Each of these offices services brokers within the state with local underwriters and business development managers servicing customers ‘tailored needs’. Our expert claims team is centralised in Newcastle but broken into state teams to encourage relationship building and enhanced customer and local supplier knowledge.

UAA has seen many competitors come and go over the years. Most have attempted to ‘copy and paste’ the UAA ISP product, but UAA has stood the test of time and most importantly maintained its enormous autonomy and reputation in the insurance industry as the experts in mobile plant and machinery insurance – globally. 

UAA works closely with the industries they insure to understand the ever-changing landscape and exposures to not only provide adequate coverage but to also assist in mitigating some of these risks through improved industry behaviour and increased safety standards. 

In 2002, UAA formed a relationship with QBE Insurance, which assisted UAA as a security and lead underwriter for a portion of its Broadform Liability insurance. 

In 2008, this relationship then led to the sale of UAA to the QBE Group. QBE became the owner, security, and lead underwriter across all of UAA’s covers in the ISP product. 

QBE recognised and valued UAA’s expertise, ensuring that the UAA business maintained its entrepreneurial flair, nimbleness, and autonomy to remain the leading niche underwriter it had worked hard to establish over the years.

During this period, UAA took advantage of QBE’s global footprint and the intellectual property embedded within the business to expand globally, particularly as it was identified that no other insurer in the global market offered the niche product and services of UAA. 

In 2012, UAA moved to Chile in South America as the first offshore business and, within 18 months, wrote over US$6 million of premiums on local QBE paper. From there many of the other major Latin American countries came knocking on UAA’s door and the business expanded into other Latin American emerging markets like Colombia, Mexico, Ecuador, and Brazil. 

In 2014, UAA entered New Zealand and formed Underwriting Agencies of New Zealand (UANZ). UANZ is now UAA’s largest business outside of Australia and the leading specialist mobile plant and machinery insurer in New Zealand. Soon after, UAA entered the Pacific Islands, based in Fiji, forming Underwriting Agencies of Fiji (UAF) in order to support its New Zealand and Pacific customers. 

Between Australian and New Zealand, UAA now underwrites over 80per cent of the crane industry insurance. 

In the same year UAA took the business to Singapore to attract the South East Asian market including Hong Kong, and formed Underwriting Agencies of Singapore (UAS). Yes, you guessed it, UAA is not very creative when it comes to naming its business offshore, as CEO Michael Murphy says, but one thing for certain is that it knows how to support the industry – globally. 

The ownership with QBE lasted seven years. In 2015 QBE sold UAA to the Steadfast Group, which is the largest general insurance broker network and the largest group of insurance underwriting agencies in Australasia, with over $11.5 billion of premium per annum across its network. The Steadfast Group is a publicly listed ASX 100 company.

Through this acquisition Steadfast hold 88 per cent share of UAA, while the remaining 12 per cent is owned by the UAA executive team, Michael Murphy (CEO), Stan Alexandropoulos (COO), George Grasso (CCSO) and Jane King (CUO). 

UAA’s relationship with Steadfast has further strengthened its capabilities in working with all insurance brokers and their combined mutual customers from the plant and machinery industries. 

The role of a broker is to dig deep with its customers to understand their exposures and help mitigate these risks by finding solutions to reduce these exposures. Where needed it will go to the market to find the most appropriate insurance coverage for its clients. When it comes to mobile machinery insurance, UAA is front of mind for most brokers.  

At UAA there is the saying that all of its policies are hand crafted because no two businesses are the same. UAA tailors coverage to suit individual customer needs in the crane, mobile plant and construction equipment sectors.

UAA is respected and trusted by the insurance industry across the globe, which has enabled it to build an extensive network of industry repairers and professionals that assist its customers at their time of greatest need: during a claim.

To coincide with the UAA’s 50th birthday celebrations, UAA and MECON Insurance recently announced the two businesses have agreed to merge. 

MECON is short for Mechanical and Construction and, as an insurance business, has been operating in the construction insurance and plant and equipment space for 18 years. Both businesses are under the Steadfast Group umbrella. MECON is considered a leading construction insurer in the Australian market and will continue to operate under their own established brand.

Michael Murphy discusses the benefits that clients of UAA and MECON will see following the merger.

“The message to our clients, the insurance brokers and also to our end users, is ‘Two brands one family’. Clients can now come to one family for the best two products and receive the unparalleled service we are now capable of offering. In our opinion, the delivery mechanism is compelling,” he said. 

“MECON is the best contract works specialist underwriter in Australia and we like to think UAA is the best underwriter of plant and equipment. The power of bringing the two together is insurmountable.” 

The merger means UAA and MECON will have a large market share in the construction insurance space at large. The combination of UAA’s strength in plant and machinery combined with MECON’s strength in construction means there is a high chance UAA will be managing the insurance for machinery and plant and MECON the insurance of the contract works. 

UAA conducts a Net Promoter Score survey through the network of insurance brokers it works with and the most recent results have come back at plus 56. MECON also enjoys a high NPS, gauged through annual surveys with brokers.

“Most insurance and finance companies are happy to register a positive result. UAA’s results increased by 12 points compared to the previous survey. This is as a result of how the claims team performed during the recent flooding disasters. We challenged our team to be superstars during what was an extremely challenging period and they delivered,” said Murphy.

One thing the UAA Group has never done is rest on its laurels and 2023 will be another big year in UAA’s history as it continues its global expansion into the Canadian market and beyond. 

It looks forward to continuing its journey as a driving force behind mobile plant and equipment protection globally for at least another 50 years.

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