More changes at the top as UK insurer partners with Indonesia’s largest publicly listed company

The news that Aviva and Astra International have signed an agreement to form Astra Aviva Life, a 50-50 joint venture to sell and distribute life insurance products in Indonesia, comes during a period of rapid change for Aviva.

The announcement marks the start of the second year of a complete overhaul of the insurer being overseen by group chief executive Mark Wilson.

Wilson has made several senior-level appointments at Aviva in recent months, as well as shedding non-core assets and boosting areas that warrant further investment, such as the Astra partnership.

However, the most recent change has been forced upon the company, with chief financial officer (CFO) Pat Regan (pictured) announcing his intention to leave Aviva to join QBE as its CFO. Regan joined Aviva in February 2010 and was appointed to the board as an executive director.

Formal arrangements for the search for a new CFO are in progress, with Regan scheduled to leave for his new role in Sydney in June.

The Astra Aviva Life joint venture is also expected to be launched later this year, subject to regulatory approval.

And the agreement is no small thing. Astra is Indonesia’s largest publicly listed company with a market capitalisation of about $25bn. It consists of 179 companies and employs more than 197,000 people across Indonesia. It serves more than 10 million customers per year in the automotive, financial services, heavy equipment and mining, agribusiness, infrastructure and logistics, and information technology segments.

The head of Aviva Asia Khor Hock Seng said that Astra International was “an extremely well known and respected brand with extraordinary scale and reach across Indonesia” and that expanding Aviva’s presence in Indonesia complemented the company’s existing focus on China and South-East Asia. “This joint venture has the potential to be a leader in Indonesia, one of the most attractive and fastest growing insurance markets in the world,” he said. “It has the fourth largest population [in the world], strong economy growth and low insurance penetration.”

President director of Astra International Prijono Sugiarto said that the joint venture was in line with “Astra’s strategy to continue to expand and diversify, entering new business areas in which we believe we can create a market-leading business underpinned by our values and management philosophy”.