Insurance Australia Group’s Managing Director and CEO Mike Wilkins has announced the Group expects to deliver a full year insurance margin in the range of 9%–11%, compared to its expectations held at the outset of the year of 10.5%–12.5%.
This guidance encompasses:
• Ongoing strong underlying performance from the Australian and New Zealand businesses, offset by a further second half operating loss from the UK, albeit at a lower level than that of the first half;
• Full year natural peril claim costs of $500 million, which exceeds the Group’s full year budgeted allowance of $435 million;
• A charge of approximately $40 million for the new UK reinsurance arrangement, in respect of the underwriting year ended 31 December 2010;
• Full year net reserve releases not exceeding FY10’s $228 million (excluding the UK strengthening in 2H10); and
• No material movement in foreign exchange rates or investment markets in 2H11.
The Group’s full year guidance for underlying gross written premium growth remains unchanged at 3%−5%.
“The ongoing strength of our businesses in Australia and New Zealand gives us confidence the Group will deliver an insurance margin in the 2011 financial year of 9%–11%, compared to 7% reported in 2010. We expect this improvement to be achieved despite higher anticipated natural peril claim costs and a delay in the
restoration of our UK operation to profitability,” Mr Wilkins said.
IAG will announce its half year result on 24 February 2011 and plans to provide a more in-depth update on each of its businesses and longer term strategy on 14 June 2011.
Please note Quotesonline Insurance News is an information service provided by third parties Insure 247 Australia doesn’t warrants the accuracy of any information contained there in, readers should make their own enquiry’s before relying on information in the stories Terms of Service