QBE has announced that John Neal, group CEO of the firm, will step down from his role after five years in the top job.

Neal will be replaced by Pat Regan, current CEO of Australian and New Zealand operations and former group CFO, on January 01, 2018.

Regan will remain on the QBE board as an executive director following his four month leadership transition.

Marty Becker, QBE group chairman, praised Neal’s work at the firm through a challenging period.

“John has led the business through a significant transformation and a challenging period in the insurance industry globally and has been working closely with the board to ensure a smooth transition for his succession,” Becker said.

Becker said that Regan’s turnaround of the Australian and New Zealand operations of the business, which he has led since August 2016, highlight Regan’s operational skills and business acumen.

“The board has undertaken a detailed succession planning process over the last two years, and has carried out an internal and external candidate review process for this appointment,” Becker continued.

Regan, who joined QBE in 2014, said that finding a replacement for the key local business is paramount.

“One of my first priorities will be to lead a search for my successor as chief executive officer of our Australian and New Zealand operations,” Regan said.

Neal’s decision to step down comes as a surprise for the industry as he stressed after the announcement of QBE’s half yearly results last month that his job was not yet finished with the firm.

QBE saw strong results in its Australian and New Zealand operations as well as a good performance in its US business impacted by issues in emerging markets in Latin America and Asia.