IAG lowers insurance margin guidance
March 26, 2010
Insurance Australia Group Limited (IAG) lowered its FY10 insurance margin guidance to 9.5% - 11.0%, from 10.5% - 12.0% as a result of the impact of the severe weather which struck Perth on 22 March. The company confirmed that, as at the close of business on 25 March 2010, it had received in excess of 13,500 claims.
IAG said as a consequence it expects to claim on its catastrophe reinsurance cover, capping the total pre-tax cost of this event at $75 million.
The company said the revised guidance assumes IAG’s natural peril costs in the second half of the financial year will exceed the budgeted $184 million allowance by $180 million.
Managing director and CEO, Michael Wilkins, said that while the vagaries of the weather have again forced the company to refine its full year guidance, be continues to be confident that the fundamentals and underlying performance of the business remain strong.
IAG said its FY10 insurance margin guidance is subject to losses from natural perils being within the revised natural perils forecast for the second half, no material movement in foreign exchange rates and no material movement in investment markets.
As at 1325 AEDT, IAG shares were down 1c to $3.90.
IAG said as a consequence it expects to claim on its catastrophe reinsurance cover, capping the total pre-tax cost of this event at $75 million.
The company said the revised guidance assumes IAG’s natural peril costs in the second half of the financial year will exceed the budgeted $184 million allowance by $180 million.
Managing director and CEO, Michael Wilkins, said that while the vagaries of the weather have again forced the company to refine its full year guidance, be continues to be confident that the fundamentals and underlying performance of the business remain strong.
IAG said its FY10 insurance margin guidance is subject to losses from natural perils being within the revised natural perils forecast for the second half, no material movement in foreign exchange rates and no material movement in investment markets.
As at 1325 AEDT, IAG shares were down 1c to $3.90.
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