|Founded||2000 (renamed from NRMA Insurance Group in 2002)|
|Headquarters||Level 13, Tower Two, Darling Park|
201 Sussex Street
Sydney NSW 2000
|Elizabeth Bryan (Chair)|
|Products||General, commercial, vehicle, home and contents insurance,|
|Revenue||A$11.8 billion (2017)|
|A$929 million (2017)|
Number of employees
|Subsidiaries||NRMA Insurance, CGU Insurance, SGIO, SGIC, Swann Insurance, NZI, AMI Insurance, NZI Thailand, Safety Insurance, AmAssurance, Lumley Insurance, WFI|
Insurance Australia Group Limited (IAG) is a multinational insurance company headquartered in Sydney, Australia.
IAG was formed by the demutualisation of the NRMA Insurance business in July 2000 and a return of shares to the members of NRMA. According to its website, NRMA Insurance Group Limited changed its name to Insurance Australia Group Limited on 15 January 2002. IAG is the name of the listed entity and it is not a customer-facing brand, however it represents the umbrella organization that holds many well known insurance brands.
IAG is listed on the Australian Securities Exchange and is a constituent of the S&P/ASX 50 index.
Insurance Australia Group has operations in Australia and New Zealand and a presence in five countries in Asia. Its businesses and brands include:
IAG has a 70% shareholding in Insurance Manufacturers of Australia Pty Limited (the other 30% being held by RACV), which issues insurance under the RACV Insurance name that is sold by RACV in Victoria.
In 2014, IAG signed a ten-year agreement to distribute home and car policies for Coles Insurance.
In 2004, speculation emerged that IAG would merge with Australia's then largest insurer QBE Insurance, however IAG denied the merger at the time. Speculation again emerged in 2006 only to be again denied.
On 10 April 2008, QBE proposed a takeover with each IAG share being exchanged for 0.135 QBE shares plus 50 cents cash (an effective value of $3.75 per IAG share at the time). This proposal was rejected by the IAG board the next day. QBE responded by increasing its proposal to 0.142 QBE shares plus 70 cents per IAG share. On 14 April 2008, IAG also rejected this proposal. On 16 May 2008, QBE increased its proposal to 0.145 QBE shares plus 90 cents per IAG share (an effective value of $4.60 per IAG share at the time). This was rejected by IAG four days later and on 21 May 2008 QBE confirmed talks had collapsed and withdrew its proposal.
Important items that were considered when QBE made its proposal: 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 Limited. 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. If one of IMA's shareholders were to experience a change of control, the other has a pre-emptive right to acquire that shareholder's interest in IMA at market value. The duration of the arrangements governing RACV's distribution of RACV-branded products in Victoria would be a relevant factor in determining this market value (as would the duration of the arrangements governing IMA's reinsurance of NRMA-branded products in NSW and the ACT).
On 16 December 2013 IAG announced that it had agreed to purchase Wesfarmers Insurance underwriting businesses. The acquisition comprises companies trading under the WFI and Lumley brands, as well as a ten-year distribution agreement with Coles.
In 2015, IAG share price has fallen 9% since it reported its interim result. The insurer's net profit for the six months to December fell 10% to $579m due to intensifying competition and a jump in natural disaster claims. Disaster claims of $421m exceeded the company's expectations by $71m, mainly on account of $165m in claims following Brisbane's November hail storm – the worst seen in 30 years.
IAG's New Zealand business delivered a 26% rise in gross written premiums, though entirely on account of adding Wesfarmers' NZ-based operations. The underlying profit margin increased from 14.2% to 15.9% due to a period of few natural disasters but the company is still feeling pain from the massive 2011 Canterbury earthquakes.
In June 2015, Berkshire Hathaway acquired a 3.7 percent stake in the group for a fee of around $388 million in a partnership aimed at reducing IAG's capital requirements.