IAG annual report—Concise

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“NOW I GET THE BIG DEAL ABOUT BEING WITH A BIG COMPANY.”
MANAGING COSTS PAYING CLAIMS UNDERSTANDING AND PRICING RISK REDUCING RISK MANAGING COSTS While Helen Warwick and her husband were away enjoying a holiday in November, they were unaware of the severe thunderstorm that hit their Sydney suburb. Unfortunately, their house was struck directly by a bolt of lightning during the storm. “We came back to find that our two TVs and computer had literally blown up. The jolts of electricity had surged throughout most of the house. Even my electric toothbrush was fried,” Helen said. “I never fully understood the benefit of being with the biggest general insurance group in Australia until I made my claim.” As part of their standard cover, Helen could have replaced their televisions and computer new-for-old. But, she discovered that she could go one better than that. “We were able to save money on new, more advanced electrical equipment for our home by tapping into NRMA Insurance’s buying power.” Helen was able to deal directly with NRMA Insurance’s wholesale electrical goods suppliers. She chose to replace their old 58cm television with a brand new 68cm flat-screen television, by paying only the difference between the insured value of their old model and the wholesale price of the upgraded model. In effect, they saved hundreds of dollars by accessing NRMA Insurance’s supply network. Helen Warwick NRMA Insurance customer Sydney, NSW Many people understand that insuring with a bigger company offers greater security. What they may not realise is that size can provide other customer benefi ts too. The economics of IAG’s business are based on scale. Scale allows IAG to manage costs through access to volume discounts across the supply chain, without sacrifi cing quality. For customers, that means better, more competitively priced products including white goods, electrical appliances, jewellery and furniture, as well as services from suppliers such as smash repairers, builders and decorators. For customers, it’s a win-win: they get the security of being with the leading insurance group in Australia and New Zealand, but are also able to share in the cost benefi ts that come with our scale. ADMINISTRATION RATIO Our administration ratio (our administration expenses measured as percentage of our net earned premium): 17.7% BUSINESS VOLUME PER FULL-TIME EMPLOYEE The number of policies and risks that IAG insures per employee: CONTRIBUTORS TO THE COST OF RUNNING OUR BUSINESS Claims expenses Government levies and taxes Underwriting and administration Underwriting profit Commissions Reinsurance expenses 7
Page 1 and 2: IAG ANNUAL REPORT 2005 A RISK MANAG
Page 3 and 4: More than one in fi ve homes and on
Page 5 and 6: PAYING CLAIMS PAYING CLAIMS UNDERST
Page 7: UNDERSTANDING AND PRICING RISK PAYI
Page 11 and 12: REDUCING RISK PAYING CLAIMS UNDERST
Page 13 and 14: HOW INSURANCE WORKS PREMIUMS CLAIMS
Page 15 and 16: QUALITY PERFORMANCE It gives me gre
Page 17 and 18: PERFORMING IN A COMPLEX OPERATING E
Page 19 and 20: The next pages highlight some impor
Page 21 and 22: MEASURING THE SUSTAINABILITY OF OUR
Page 23 and 24: AUSTRALIA AUSTRALIAN PERSONAL INSUR
Page 25 and 26: CHRISTINE McLOUGHLIN BA, LLB HONS,
Page 27 and 28: This year saw a new addition to our
Page 29 and 30: Drawing on the existing expertise i
Page 31 and 32: Customer satisfaction results demon
Page 33 and 34: MR GA (GEOFFREY) COUSINS Age 62 - I
Page 35 and 36: • Ensuring that reporting and dis
Page 37 and 38: • Making recommendations to the B
Page 39 and 40: The roles and composition of the ex
Page 41 and 42: FINANCIAL REPORT CONTENTS 40 Five Y
Page 43 and 44: DIRECTORS’ REPORT The concise fin
Page 45 and 46: DIRECTORS’ REPORT Cash flows from
Page 47 and 48: DIRECTORS’ REPORT The following t
Page 49 and 50: DIRECTORS’ REPORT During the year
Page 51 and 52: DIRECTORS’ REPORT (b) Remuneratio
Page 53 and 54: DIRECTORS’ REPORT 2.7 Long Term I
Page 55 and 56: DIRECTORS’ REPORT 3. NON-EXECUTIV
Page 57 and 58: DIRECTORS’ REPORT 3.5 Retirement
Page 59 and 60:
DIRECTORS’ REPORT ROUNDING OF AMO
Page 61 and 62:
DISCUSSION AND ANALYSIS OF THE FINA
Page 63 and 64:
CONSOLIDATED STATEMENT OF FINANCIAL
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NOTES TO THE FINANCIAL STATEMENTS F
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SHAREHOLDER INFORMATION You can acc
Page 81 and 82:
SHAREHOLDER INFORMATION IAGPA RESET
Page 83 and 84:
GLOSSARY Actuary APRA An actuary ap
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IAG annual report—Concise

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