IAG has reported a net profit after tax of $505 million for the first half of FY26, down from $778 million a year earlier, as severe seasonal weather weighed on earnings.
The result included a one-off $174 million impact from the RACQI portfolio following extreme weather events in Queensland prior to its integration into IAG’s reinsurance program in January 2026. The prior corresponding period had benefited from favourable perils experience and a business interruption provision release.
Despite the weather hit, underlying insurance profit rose to $804 million, delivering a 15.1 per cent underlying insurance margin, in line with the prior period. Excluding the one-off RACQI impact, the underlying margin lifted to 16.3 per cent.
IAG Managing Director and CEO Nick Hawkins said the result highlighted the insurer’s strengthened earnings profile.
“Today’s result shows the strength of our business, reflecting the work we’ve done to deliver a more stable earnings profile and maintain a strong underlying margin,” Hawkins said.
Reported gross written premium increased six per cent, supported by retail growth across Australia and New Zealand and a four-month contribution from RACQI. The Australian intermediated division delivered 3.5 per cent underlying growth, while New Zealand commercial operations faced softer market conditions and currency headwinds.
The board declared an interim dividend of 12.0 cents per share, franked to 25 per cent, and announced an on-market share buyback of up to $200 million, citing a strong capital position.
During the half, Queensland was impacted by 17 separate weather events, with more than 35,000 claims lodged with IAG following major hailstorms and severe weather across south-east Queensland and northern New South Wales.
Looking ahead, IAG expects high single-digit gross written premium growth in FY26 and has maintained its insurance profit guidance range of $1.55 billion to $1.75 billion. The group said it anticipates reported insurance profit to be around the bottom end of that range, reflecting first-half weather impacts.