Insurance Australia Group to Review UK Business

Insurance Australia Group’s Managing Director and CEO Mike Wilkins has indicated that it is an “appropriate time to assess the options for the UK business, given the improvement in its performance and the current UK economic conditions.”

IAG reported that during the six months ended December 31, 2011 the UK business reported an insurance loss of $5 million, compared to a loss of $121 million in the previous corresponding period.

While the Group’s “business’ remediation program” continues, and it sees “early signs of government action on necessary industry reform,” IAG said it will nonetheless access its options. “These include, but are not limited to, a continuing focus on improving the business’ performance within the current operating model, refining the business’ strategy to a more focused specialist motor offering, and exploring options for a potential sale of all or part of the business.”

Wilkins stated: “One of our key strategic priorities is to return the UK to profitability. Given the progress towards that goal in the opening half of the current financial year, we believe the time is right to consider our longer term plans for the business, and the best way to maximize shareholder value.”

IAG plans to announce an update on the strategic review when it reports its full year financial results in August.

Source: Insurance Australia Group.