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IAG reports higher GWP but lower FY2026 profit amid natural peril costs
IAG said net perils costs rose to AU$1.579bn, AU$114m above its allowance, weighing on FY2026 net profit after tax.
Insurance Australia Group reported full-year 2026 results with gross written premium up 7.6% year over year to AU$18.412bn, but net profit after tax fell to AU$1.022bn from AU$1.359bn in FY2025.
Reinsurance News said the decline reflected elevated natural peril activity, with net perils costs of AU$1.579bn, AU$114m above the group’s allowance, compared with a AU$195m favourable perils outcome in FY2025. IAG also reported pre-tax insurance profit of AU$1.552bn, down from AU$1.743bn a year earlier.
The company’s underlying insurance profit rose to AU$1.578bn in FY2026 from AU$1.542bn in FY2025, though the underlying insurance margin was 15%, 50 basis points below FY2025. IAG attributed that to an improvement in its underlying claims ratio and expense ratio being more than offset by higher perils allowance, first-year transitional impacts from its RACQ Insurance acquisition, and a lower investment yield on technical reserves.
IAG said its Australian retail gross written premium grew 17.8% to AU$10.308bn, including AU$1.272bn from the acquired RACQ Insurance business, while Australian intermediated GWP edged up 1.1% to AU$4.6bn. It also reported New Zealand GWP declined 8.0% to AU$3.504bn, with the drop attributed to a weaker New Zealand dollar.