IAG Reduces Earnings Volatility with Long-Term Reinsurance Deals
IAG Reduces Earnings Volatility with Long-Term Reinsurance Deals

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IAG, one of Australia’s largest insurers, has secured a five-year natural perils reinsurance agreement with National Indemnity Company, a subsidiary of Berkshire Hathaway, and Canada Life Reinsurance, providing up to AU$680 million of additional protection annually. This deal aims to mitigate natural perils volatility and limit IAG’s natural perils costs to AU$1,283 million in the financial year ending 30 June 2025. Additionally, IAG has purchased an adverse development cover for its long-tail reserves of approximately AU$2.5 billion. The insurer’s managing director and CEO, Nick Hawkins, stated that this agreement will help provide greater certainty over natural perils costs as extreme weather events become more frequent and severe.
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