Insurance Australia Group (IAG) has posted a profit attributable to shareholders of A$832m ($533m) for FY23, a 140% increase from A$347m ($222m) a year ago.

Gross written premium (GWP) rose 10.6% to A$14.7bn compared with A$13.3bn in FY22.

The company attributed this growth to a surge in premiums across its three businesses as inflation soared and increased reinsurance and natural perils expenditures.

Insurance profit was A$803m, a 37% rise from A$586m in the year-ago period. 

The company’s reported insurance margin was 9.6% compared with 7.4% in FY22. The rise in margin was driven by credit spread gains and reduced reserve strengthening last year. 

The underlying insurance margin declined to 12.6% from 14.6% in FY22. The company attributed the drop in margin to higher inflation in home and motor claims prices and a rise in natural perils allowance. 

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By GlobalData

IAG said it paid a total of approximately A$10.2bn in claims, a rise of almost 20% from last year.

The company also declared a dividend of nine Australian cents per share (cps) for the year, up from 5cps a year ago. 

IAG managing director and CEO Nick Hawkins said: “FY23 was a solid year for IAG, reflecting the positive momentum in our core businesses and the significant progress we’ve made to create a stronger and more resilient company.

“We enter FY24 with positive momentum across the company and confidence that the strategy we have in place will deliver long-term benefits for our shareholders and the 8.7 million customers we serve.”