I used to be an IAG shareholder a number of years ago, but it is a total box business, and a perpetual "gunnah" company but one which almost never does.
The volatile and unpredictable underwriting business, combined with the translational impacts of investment markets on IAG's profits render investing in IGA a bit of a crap shoot, in my view.
I note that the FY2022 Outlook in today's update has commentary about positive rate environment across both personal and commercial lines.
If that is the case then I wonder why anyone wouldn't instead invest in an insurance product distributor, such as an insurance broker, rather than an insurance product manufacturer like IAG.
Because with an insurance broker you still get to participate in the favourable rate cycle, but without the often knee-capping vagaries of the business that is insurance underwriting.
(Also, with an insurance product distributor you don't have to wrestle with the arcane insurance accounting practices, such as reserve releasing/padding or having to constantly mark policy holder floats to market.)
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IAG Price at posting:
$4.88 Sentiment: Hold Disclosure: Held
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