IAG has disclosed its full-year 2026 financial results, posting a 7.6% year-over-year increase in gross written premium (GWP) to AU$18.412bn and net profit after tax (NPAT) of AU$1.022bn.
The FY2026 NPAT figure was down from AU$1.359bn in FY2025, as increased natural peril activity weighed on insurance earnings.
The Australian firm’s pre-tax insurance profit was AU$1.552bn in FY2026, compared with AU$1.743bn a year earlier.
IAG said the result primarily reflected increased natural perils, with net perils costs of AU$1.579bn, AU$114m above the group’s allowance. This compared with a AU$195m favourable perils outcome in FY2025.
The insurer’s underlying insurance profit rose to AU$1.578bn in FY2026 from AU$1.542bn a year earlier, translating into an underlying insurance margin of 15%, 50 basis points below FY2025.
IAG said an improvement in its underlying claims ratio and expense ratio was more than offset by a higher perils allowance, first-year transitional impacts from the acquisition of RACQ Insurance, and a lower investment yield on technical reserves.
Excluding the one-off RACQI impact, the underlying insurance margin in FY2026 was 16%.
As mentioned, IAG’s gross written premium increased 7.6% to AU$18.412bn in FY2026. Australian Retail GWP grew 17.8% to AU$10.308bn, including AU$1.272bn from the acquired RACQI business.
Underlying growth was approximately 4.5%, supported by modest rate increases and improved volume momentum, with growth accelerating in the second half on higher new business in direct motor and home.
Australian Intermediated GWP increased 1.1% to AU$4.6bn in FY2026, from AU$4.55bn in FY2025. Underlying growth was approximately 2%, which IAG attributed to discipline in a competitive market.
Meanwhile, New Zealand GWP fell 8.0% to AU$3.504bn in FY2026 from AU$3.807bn in FY2025, significantly affected by a weaker New Zealand dollar.
In local currency, GWP declined 2.7% to NZ$4.06bn, with IAG pointing to solid growth and momentum in direct home and motor, alongside continued discipline in the Intermediated business.
IAG Managing Director and CEO, Nick Hawkins, commented, “FY2026 was a year of strategic execution and evolution for IAG, including continued technology platform transformation, completion of the landmark RACQ Insurance acquisition, and the launch of Ambition 2030 – our refreshed strategy which outlines our commitment to delivering value for customers and stakeholders.
“In a year of elevated natural perils, our financial results reflect the deliberate strategic choices we have made to reduce volatility and deliver sustainable, growing shareholder returns. We are well positioned for growth and have a clear path to continue supporting customers through adversity and achieving our long-term financial targets.”
Hawkins continued, “Throughout FY26, we actively managed our response to 65 severe weather events across Australia and 44 in New Zealand, demonstrating our strength, scale and technologically advanced operations. We paid more than $12.4 billion in claims over the year, supporting our customers and their communities to recover from adversity.
“We have a strong financial position and have good growth momentum in our Australian and New Zealand retail segments. Our trusted brands, underwriting expertise, technology platforms and data assets, supply chain, and financial strength provide us with considerable competitive advantages.
“Profitable growth continues to be a strategic priority. Operating in growing markets, we will continue to focus on organic opportunities to increase our market share. Our alliances with RACQ in Queensland and RAC in WA2 are expected to deliver further scale.
“Our technology transformation has materially improved how we underwrite and distribute insurance. The successful migration of eight million policies to our Retail Enterprise Platform and the accelerated delivery of our Commercial Enterprise Platform are delivering customer benefits, simplification and improved productivity.
“Central to our transformation is AI for organisational efficiency, competitive positioning and customer service. More than 60% of our people use AI regularly, and we have more than 90 AI solutions in use throughout the business. Last month we announced a new partnership with OpenAI that will help our people deliver more effective customer service, particularly in claims handling during severe weather events.
“Across Australia and New Zealand, we are delivering on our promise to support customers when they need it most. This year we helped more than 25,000 customers who were experiencing vulnerability, while leveraging AI, real-time hazard intelligence and technology to improve customer response times. We expanded our partnership with AgGuard to provide specialist rural insurance solutions and invested in Sonder, giving more customers access to wellbeing and safety services.
“Our launch of Ambition 20301 set out a clear plan for IAG’s next phase of growth. We are targeting more than 11 million customers and over $25 billion in premiums while maintaining industry-leading customer advocacy outcomes. Ambition 2030 clearly outlines our targets of 15% or higher ROE, high single-digit EPS growth, and topquartile total shareholder returns, providing sustainable, growing dividends.”
