IAG New Zealand Announces FY24 Results

Today IAG New Zealand has reported an insurance profit of AU$457m, an increase on the AU$44m FY23 insurance profit, which was significantly impacted by the North Island floods and Cyclone Gabrielle. The reported insurance margin of 22.5% (FY23: 2.4%) reflects the significantly lower perils experience and a higher underlying margin of 16.9% (FY23: 13.5%).

IAG New Zealand experienced a lower underlying loss ratio due to earn through from premium increases, lower motor frequency compared to the prior year and benefits from claims and supply chain initiatives, including expansion of the RepairHub network. This was offset by higher labour and parts costs and home fire claims.

Overall GWP increased 15.6% to AU$3,796m (FY23: AU$3,284m) and in underlying local currency 15% to NZ$4,126m.

IAG New Zealand CEO, Amanda Whiting says: “This result reflects the strong relationships we hold with our customers, who trust us with their insurance needs, the strength of the IAG New Zealand business and the investment we have put into our people and operations.

“IAG New Zealand’s profit was driven by growth in gross written premiums, stronger returns on investments and fewer devastating weather events than we have experienced in recent times.

“We understand the impact that premium increases have had on some customers, and we have bolstered our support for anyone experiencing cost-of-living pressures. With inflation now beginning to ease, and our long-term reinsurance arrangements announced in June, we expect premium increases to stabilise.”

Advertisement - scroll to continue reading

Amanda Whiting adds: “Given New Zealand’s susceptibility to natural hazards and their volatility, insurers must take a multi-year view of their financial performance. Within the insurance cycle, we need to balance out the bad years with the good. Over the last 15 years New Zealand has experienced the four largest and most devastating events in its history, which have had significant impacts on the performance of insurers.

“This year’s result reflects the absence of any major natural disaster or significant weather events. It is important to maintain the strength of our business, so we can secure the capital we need to support and protect New Zealanders.

“Carefully managing these ups and downs over the years allowed us to celebrate, in May, the legacy milestone of NZI’s 165 years of insuring New Zealand businesses.”

This year IAG New Zealand insured over NZ$1.07 trillion of New Zealand assets and continued to protect approximately one in two New Zealand households. IAG New Zealand received 552,000 claims and paid out NZ$2.891 billion to help get New Zealanders back on their feet.

Amanda Whiting adds: “By 30 June 2024, we had closed approximately 97% of the more than 50,000 claims received from the devastating Cyclone Gabrielle and the North Island floods, including 98% of home, 99% of contents and 99% of motor claims. We are also committed to supporting customers over the longer-term as we help them recover from these events.

“To better support our customers, we have continued to invest in a new Enterprise Platform system which has immediately improved our technology and operations. We have completed the migration of a significant number of our customers’ policies to the new system, which will enable us to better price and manage risk. This work is ongoing.

“At the same time, we continued to support the evolving needs of our customers. Some notable highlights include, reinvigorating our retail presence with the launch of AMI Insurance Hubs in Auckland and Christchurch alongside partner Motor Trade Finance (MTF). Aligning with customer feedback, the AMI Insurance Hubs provide customers with a dedicated physical space to seek expert insurance advice, tailored solutions and face-to-face service.

“We also expanded other parts of our Hub model, providing customers with further flexibility at claim time and complementing our network of high-quality repairers.

“AMI RepairHub opened its seventh and eighth sites, and we established a dual hub in Ngauranga, Wellington to service cars and undertake light commercial and structural repairs – a first for IAG in New Zealand.

“Our new one-stop shop for home repair claims, AMI HomeHub, also launched in Auckland, Hamilton and Christchurch. Built around customer needs and refined through their feedback, HomeHub provides a streamlined customer experience from claim to completion. The operation sits alongside our trusted repairer partners, giving customers multiple reinstatement options.”

Sustainability

As New Zealand’s largest general insurer, IAG New Zealand sees first-hand the impact of climate change through the changing, and at times, destructive weather patterns that affect local communities.

Amanda Whiting says: “We continue to work closely with government, councils, and local communities on our climate response to ensure insurance remains accessible for New Zealanders. We recognise the responsibility we have to take a leadership role on risk mitigation and the use of data to not only educate New Zealanders, but also inform sustainable decisions.

“To keep people safe, we must reduce flooding and natural hazard risk through good planning decisions, investment in protection and resilience measures, and where necessary, through relocating people away from at-risk properties. The Government’s focus on adaptation and the NZ$200m allocated to flood protection in this year’s budget is a great start, but further action is needed, and we are committed to playing our part.”

Sustainability achievements this year include the support of Habitat for Humanity’s winter fundraising campaign, an agreement with New Zealand’s climate positive certified electricity provider Ecotricity, the publishing of our first mandatory climate-related disclosure, and the continued uplift in te ao Māori through several exciting initiatives, including a new three-year partnership with the TupuToa internship programme.

Amanda Whiting adds: “Our work in these areas, alongside our achievements, will enable us to continue to run a strong, sustainable business. This means we can continue to be here for New Zealanders when they need us, well into the future.”

Operating highlights

• Migrated a significant number of policies to the Enterprise Platform and upgraded New Zealand’s telephony systems, providing improved digital experience for customers.
• Introduced more ways for customers to understand risks plus pricing benefits for taking positive action.
• Expanded the AMI Hub Services footprint in New Zealand, to provide essential services for customers, including:
  • Launch of AMI Insurance Hubs in Christchurch and Auckland alongside partner Motor Trade Finance (MTF).
  • AMI RepairHub opened its seventh and eighth sites and repaired 25,714 vehicles at AMI RepairHubs across the country.
  • AMI HomeHub launched in Auckland, Hamilton and Christchurch.
  • AMI Roadside Rescue relaunched its award-winning rescue service - now available to all New Zealanders as a single, simple, standalone subscription.
• AMI named Canstar’s Car Insurer of the Year.
• NZI celebrated 165 years of business.
• NZI Electrical Inspectors visited over 700 customers and identified 2,700 defects needing repair to avoid potential electrical fires.
• 87% of IAG New Zealand’s corporate fleet is now EV or hybrid - 79% of AMI RepairHub courtesy cars now hybrid.
• AMI Community Events team conducted 37 events in local communities across New Zealand, attended by an estimated 35,000 individuals, bringing our purpose to life by providing insurance education, risk reduction and safety information.
• AMI supported its sponsorship partner, Habitat for Humanity, in its first ever nationwide fundraising appeal - Warm Fuzzies, by providing experienced in-house designers to create the campaign and kickstart the fundraising.

About IAG New Zealand:

IAG New Zealand is the largest general insurer in the country, trading under the AMI, State, NZI, NAC, Lumley and Lantern brands, as well as providing the general insurance products sold by ASB, BNZ, Westpac and The Co-operative Bank. IAG New Zealand employs over 4,000 people, holds relationships with one in every two New Zealand households, and insures over NZ$1.07 trillion of commercial and domestic assets.

© Scoop Media