Suncorp subsidiary GIO has been dropped from Victoria’s workers’ compensation scheme – and it’s not happy with the decision.

The scheme’s administrator, WorkSafe, has named a reduced five-member panel of “agents” to manage workers’ compensation premiums and claims. Global firm Gallagher Bassett will manage GIO’s book from June 30.

The remaining panel members – Allianz, Xchanging, CGU and QBE – are unchanged.

GIO joined the panel for the second time when it took over JLT’s Victorian licence in 2005. It continues to run workers’ compensation units in NSW, WA, Tasmania, the NT and the ACT.

Suncorp’s EGM Statutory Portfolio Chris McHugh says he’s “surprised” by the decision.

“Our performance was market-leading over an extended time,” he told insuranceNEWS.com.au. “GIO consistently delivered outstanding results, particularly in return-to-work and stakeholder satisfaction metrics, so we don’t understand it.”

WorkSafe foreshadowed changes to its agent relationships in its 2010 annual report, citing issues with satisfaction levels among small businesses.

“We are mindful that more work is required to improve injured workers’ experience of the scheme,” the report said. “In 2010/11, we will be building a stronger and more productive partnership with agents as part of our agent contract tender process.”

While GIO lodged the second-highest employer satisfaction level in 2009/10 – and the third-highest among small businesses – it recorded the largest fall in satisfaction ratings among WorkSafe’s six accredited agents from the 2009 to 2010 financial years.

Observers also suggest that GIO’s book of business was the smallest, and the WorkSafe move may have been a rationalisation of its agents.

In March WorkSafe announced a half-year after-tax profit of $396 million, down on the $686 million achieved in the corresponding period last financial year.