The chief executive and managing director of the NSW government’s beleaguered insurer iCare has quit amid reports of poor financial management at the company.

State Treasurer Dominic Perrottet confirmed on Monday night that John Nagle, who has held the top job since early 2018, resigned.

It comes after the NSW Labor opposition last week released a document stating iCare’s workers’ compensation scheme had reported a $2 billion net loss to March 31.

John Nagle has quit after claims about mismanagement at iCare. Photo: ABC

Its funding ratio – a key measure of financial sustainability – had fallen to 98 per cent, the undated document shows. The state-owned insurer aims to keep the scheme’s funding ratio, or proportion of assets to liabilities, above 110 per cent.

The issue came to a head after the ABC and Nine reported last week on poor performance and financial management of iCare, which was created out of the 2015 break-up of WorkCover.

The company last week insisted in a statement there was no risk of insolvency in its workers’ compensation scheme and that conduct issues such as scheme agent incentives and so-called “doctor shopping” had already been addressed.

Mr Nagle said he was sad to leave.

“Leading the transformation of iCare was one of the most challenging and rewarding times of my career and I am glad to see the benefits now starting to be realised,” he said on Tuesday.

A non-executive board director – incumbent NSW Labor president Mark Lennon – also resigned last week after being on iCare’s board since inception.

The Public Service Association on Tuesday said the entire iCare board should step down after a parliamentary inquiry on Monday heard the company had sought to terminate payments to 17,000 workers on compensation.

It also heard Mr Nagle had been sanctioned by the board in 2019 for a conflict of interest.

“A fish rots from its head – and it’s clear the board overseeing our workers’ compensation scheme are rotten and need to go,” the PSA’s Stewart Little said.

“The current workers’ compensation model is broken. It does not have fairness incorporated into the system, deferring decisions to a list of rent seekers that rely upon the workers’ compensation system for fees – is not independent or fair.”

NSW Opposition Leader Jodi McKay made the same demand on Tuesday, tweeting that Mr Perrottet had “allowed injured workers to be underpaid while executives wallow in lavish salaries, bonuses & dodgy contracts. Let today be a circuit-breaker”.