Digital investments in its fee-based businesses set insurer IAG back $37 million in the 2022-2023 financial year, leading it to announce “restructured activities” to contain those costs in future years.
Announcing its annual results [pdf], IAG detailed investments in “advanced technologies, data asset capabilities, innovation and mobility initiatives”.
This included:
- $8 million in data and analytics supporting loyalty programs
- $6.5 million on activities in its InsureTech hub
- Around $6 million in its Ambiata data activation business and its Firemark Labs innovation labs
- $5 million spent on developing its Carbar digital car-trading platform
- $5 million of “innovation funds” in its Direct Insurance Australia (DIA) and Intermediated Insurance Australia (IIA) businesses; and
- Around $3 million developing its Cylo cyber insurance product.
IAG said customer digital channel activity in its Direct Insurance Australia (DIA) unit grew 12 percent in the financial year; it also provides insurance for NRMA, and said 43 percent of new insurance sales and 40 percent of renewals in that business are now online.
Its New Zealand business showed similar performance, with 39 percent of sales and 37 percent of claims now using digital channels.
IAG also said it will soon embark on a rollout of “one single enterprise ecosystem” in New Zealand, “that will replace multiple core policy systems, reduce complexity, and enabled improved customer propositions”.
Company-wide, the strategy is to continue “modernising core platforms and using intelligent automation”.
IAG more than doubled its net profit after tax in the year, from $347 million to $832 million, on gross written premiums which grew 10.6 percent to $14.7 billion.