What we do
IAG is the parent company of a general insurance group with controlled operations in Australia and New Zealand.
It is listed on the Australian Securities Exchange (ASX) with ordinary shares trading under the ticker “IAG.” References in the remainder of this profile to IAG and to “the Group” are to IAG and its subsidiaries on a consolidated basis. Financial data for the 12-month period ended 30 June 2021 and a more comprehensive review of IAG and its operations is contained in the 2021 annual report and the FY21 Investor Report dated 11August 2021, available in the Results & Reports section of this website.
IAG's businesses underwrite over $12 billion of premium per annum, selling insurance under many leading brands including NRMA Insurance, CGU Insurance, SGIO, SGIC, Swann Insurance and WFI (Australia); and NZI, State, AMI and Lumley (New Zealand).
IAG also has an interest in a general insurance joint venture in Malaysia. Standard & Poor’s has assigned a ‘Very Strong’ Insurer Financial Strength Rating of ‘AA-’ to the Group’s core operating subsidiaries.
Brief history
From its beginnings as a motor vehicle insurer in New South Wales (“NSW”), Australia, IAG has grown to become a general insurance group diversified by product, distribution channel and geography.
The Group’s heritage dates back to 1920 when the National Roads and Motorists’ Association (“NRMA”) was established and subsequently offered motor insurance to its members. Following demutualisation in 2000, the insurance arm of NRMA was listed on the ASX as NRMA Insurance Group Limited, and renamed Insurance Australia Group Limited in 2002.
The Group grew organically and through acquisitions primarily in its home market of Australia, and in New Zealand.
Business operations and brands
1 IAG’s short tail personal insurance products are distributed in Victoria under the RACV brand, via a distribution relationship and underwriting joint venture with RACV. These products are distributed by RACV and manufactured by Insurance Manufacturers of Australia Pty Limited (IMA), which is 70% owned by IAG and 30% by RACV.
2 IAG owns 100% of WFI Insurance Limited (WFI), the underwriter of general insurance products under the Coles Insurance brand. These products are distributed by Coles under an authorised representative agreement with WFI.
3 IAG owns 49% of the general insurance arm of Malaysian-based AmBank Group, AmGeneral Holdings Berhad (AmGeneral), which trades under the AmAssurance and Kurnia brands (see Asia section below).
All ownership percentages as at 30 June 2021
Business structure
In November 2020, IAG announced that its Australia Division would be split into Direct Insurance Australia and Intermediated Insurance Australia, effective immediately.
The new operating model provides greater clarity on roles and responsibilities and is more aligned to IAG’s brands and customer propositions. IAG has reported separate results for the two new divisions as part of the FY21 result, with comparative results restated accordingly.
Direct Insurance Australia is the largest division in IAG and plays an integral role in growing with our customers by increasing customer reach and delivering personalised, digitally-enabled services.
Direct Insurance Australia holds the largest market share in direct personal insurance in Australia, with products sold under multiple leading brands including NRMA Insurance, RACV, SGIO and SGIC. The business also provides insurance to small-to-medium enterprises on a direct basis, and regards this as a significant growth opportunity.
Direct Insurance Australia has consistently produced strong financial returns, reinforcing the strength and resilience of the franchise and for FY21, accounted for 46% of IAG’s gross written premium.
Intermediated Insurance Australia is a leading provider of general insurance products sold through a network of intermediaries to businesses and individuals across Australia. Commercial insurance is sold under the CGU and WFI brands, with a significant share of the small-to-medium enterprise market and a leading presence in rural areas.
Intermediated Insurance Australia also provides personal insurance primarily through broker and partner channels, including brands such as Coles and a number of affinity and financial institution partnerships.
Improving the level and consistency of Intermediated Insurance Australia’s profitability is a key element of IAG’s strategy to build better businesses.
For FY21, Intermediated Insurance Australia accounted for 32% of IAG’s gross written premium.
IAG is the largest general insurer in New Zealand, trading under the State, NZI, AMI and Lumley brands. IAG New Zealand sells products through a combination of direct and intermediated channels. It’s Consumer Division sells products directly to customers mainly under the State and AMI brands, and distributes products through IAG’s banking partners ASB, Westpac, BNZ and the Co-Operative Bank. The Business Division distributes products through a nationwide network of qualified and experienced brokers under the NZI and Lumley brands.
IAG New Zealand supports IAG’s strategy to become a stronger, more resilient business by continuing to support its partners and customers through services such as Repairhub and enhanced digital offerings.
For FY21, IAG New Zealand accounted for 22% of IAG’s gross written premium.
Business portfolio
IAG’s business portfolio comprises leading and established brands across its home markets of Australia and New Zealand. Exposure to concentrations of insurance risk is mitigated by a portfolio diversified into many classes of business and by the use of reinsurance.
Asia
IAG’s focus is on its core Australian and New Zealand businesses. As a consequence, IAG continues to weigh up options for its remaining Asian general insurance interests, including divestments where appropriate. IAG’s remaining Asian interests are a 49% interest in AmGeneral Holdings Berhad in Malaysia, a 80.64% interest in AAA Assurance Corporation in Vietnam and a 13.93% interest in Bohai Property Insurance Company Ltd in China.
On 19 July 2021, IAG announced that AmGeneral Holdings Berhad had signed an Implementation Agreement for the proposed sale of its wholly-owned insurance business AmGeneral Insurance Berhad (AmGeneral) to Liberty Insurance Berhad and expects to incur a loss. The transaction is expected to complete during FY22.
