The decision by global reinsurance broker Cooper Gay to quit Australia has disappointed some underwriting agency managers, who say the UK-based company has been “making strategic inroads” in the local market.

insuranceNEWS.com.au reported in a Breaking News last week that Cooper Gay, part of the global Cooper Gay Swett & Crawford group, is closing the Australian operation and will service the Australian market from its London and Singapore hubs.

While Cooper Gay management has not announced the move and managers have not returned calls, informed sources have told insuranceNEWS.com.au a number of positions in the Sydney office will be declared redundant.

However, the Epsilon underwriting agency, which Cooper Gay bought in February last year, is not expected to be affected.

A reliable London market source told insuranceNEWS.com.au Cooper Gay, which has operated in the local market for about 15 years, “will cease to have a physical presence in Australia but has not withdrawn from the Australian market”.

It is understood the relocation will be completed by the end of the year.

Underwriting agents who have worked with Cooper Gay say the company has performed a valuable role in the local market.

“The market is pretty competitive at present, and they may feel they can service the Australian market more profitably from Singapore,” one source, who declined to be named, said. “But looking at the cost of locating staff in Singapore, I can’t see how that’s possible.

“The sort of business they’re engaged in really needs a local presence.”

One underwriting agency manager contacted by insuranceNEWS.com.au said Cooper Gay “has had to reinvent itself in the local market in the past couple of years”.

Another said Cooper Gay “wasn’t meeting margin expectations”.

“The market is very competitive, and they probably needed a more supportive market.”