Profits at insurance giant IAG climbed to $900 million in the last financial year on the back of rising premiums across the group.

The insurer behind the RACV and NRMA brands posted an 8 per cent annual rise in its net profit after tax, and declared a full-year dividend of 27¢, representing 70 per cent of the group’s profits.

“We have previously said inflation, increasing weather volatility and rising re-insurance costs were major factors affecting customer premiums,” chief executive Nick Hawkins said.

“We are beginning to see some signs of inflation easing, and our long-term re-insurance agreement announced in June is expected to reduce year-on-year volatility from extreme weather events and help stabilise costs for our customers over the long term.”

Gross written premiums surged 11 per cent in a year to $16.4 billion, while net earned premiums were also up 11 per cent to $9.2 billion. The insurer paid $10.7 billion in claims.

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IAG said its strong gross written premiums were driven by motor insurance (up 13 per cent) and home insurance (up 16 per cent). It flagged an up to 9 per cent increase on premiums in the 2025 financial year.

“This assumes premium increases to cover ongoing claims inflation and the increased natural perils allowance combined with direct customer and volume growth,” IAG said in its results.

More to come