Insurance Australia Group Limited (IAG) Earnings Call Transcript & Summary

Good afternoon, everyone, and welcome to IAG's 2026 Investor Day. I'm joined here by our Chief Financial Officer, William McDonnell; our COO, Neil Morgan; the CEOs of our divisions, Julie, Jarrod and Phil and other members of the executive team of IAG are all sitting in the front row here in Sussex Street. We're holding today's event on IAG Sydney's offices on the lands of the Gadigal people. And so we acknowledge the traditional owners of country throughout Australia, and we recognize their continuing connection to lands, waters and the community. I pay my respects to elders past, present and emerging. Many of you have been on the bus trip this morning attending the showcases at our research center and the major event command center. And I hope you enjoyed the insights and the kind of uniqueness of IAG that you've just seen. Just in terms of agenda, as you can see, we've got a full agenda this afternoon. But within that, we're going to break for a couple of times for questions after a couple of the sessions. And Mark is going to help out and moderate the questions during the afternoon. So let me start with sort of the Ambition 2030 and really around how we're going to deliver that over the next 4 years. So, as you know, across Australia and New Zealand, we've got a significant responsibility to provide insurance to the community when it needs it most. Our role, as you know, is to be customer-obsessed, economic shock absorber, supported by our scale, supported by our brands and importantly, by the platforms that we've built in support of that. By 2030, we'll be targeting over 11 million customers, over $25 billion in premiums, customer engagement NPS of 55 as we continue to be the insurer of choice across Australia and New Zealand. Our ambition around growth is to grow at least in line with the market, and we'll seek opportunities to grow beyond that as they arise. For our communities, we'll continue to play a leading advocacy role in risk reduction. And, as you know, this is already in our DNA here at IAG, and we're doing more of this over the next few years. Continue to have a significant voice on climate, resilience on under insurance and on building out a safer and a more sustainable future. We want our people to thrive in a high-performing culture. We're delivering on this ambition every day through our academy, the investments we're making around capability of our people and building a future-ready workforce. And importantly, for our shareholders, we'll deliver an ROE of 15% or above, high single-digit earnings per share growth and top quartile shareholder returns. And really, these are the metrics that I've just stepped you through that are going to define our success as we deliver Ambition 2030. So if we just start with sort of a bit of a recap of the last 5 years and what we've delivered against some of the things we set out 5 years ago. I mean our customer numbers are up 1 million, up to 9.6 million. So if we sort of look behind that, the last 5 years, our Australian Retail Direct business has grown organically through the NRMA and RACV brands. And that's been complemented, of course, by our recent acquisition of the RACQ business. We have, though, reshaped our partner businesses and our retail direct business in New Zealand. Sort of pleasingly, over the last 12 months, the New Zealand retail business has been growing, and Phil is going to talk us through that shortly. Our premiums are up something like 36% to just over $17 billion. And with the addition of RACQ, more like 50% to $18.5 billion for the current financial year. Our reported insurance profits are up 73% to over $1.7 billion. And then within that, our intermediated business, which we set a target of $250 million is delivering in excess of that, as you know. And our ROE is well above the original target we set of sort of 12% to 13%. And we repurchased around 5% of our shares, and we continue to look and be capital efficient. EPS is up 42% to around $0.44 at an underlying level. These are big things, and they sort of reflect deliberate strategic choices and really, from your point of view, a management team that's really focused on delivery. And I'm really proud of the team that are sitting here in the audience today and the delivery that has occurred by this team over that period. And of course, we welcome Phil Gibson -- sorry, wrong side. We welcome Phil Gibson into the team as we take this forward and deliver Ambition 2030. So of course, our choices have really been what's helped us build out a stronger and a more resilient company. Some highlights on those choices we've made, made alliances with RACQ and then with RAC in WA. Importantly, our ability to fund growth from organic capital generation and return some of that capital to shareholders over the period. Completing the build of our retail technology platform has been a big thing and accelerating the delivery of our commercial platform. These are the building blocks we've got at IAG that are going to help us towards Ambition 2030. Pioneering long-term reinsurance protection, and William is going to talk more about that. And what all these things do, of course, is set us up well for delivery of our next phase of our strategy. I mean the markets we operate in, of course, are growing with general insurance premiums in Australia and New Zealand forecast to grow at around about 6% per annum through to 2030. I mean my view is these forecasts are likely to be conservative in that growth. If you look back the last 5 years, our markets have grown closer to 10% per annum compounded over that period. And of course, this is structural growth driven by population increases across our countries, rising asset values, increasing awareness of underinsurance, climate risk and its implications and the growing sophistication of how retail and commercial customers think about the protection that we provide. And I always say this, as an industry, we have demand greater than supply. It's helpful, which is going to help continue to fuel growth opportunity for our business. We're the market leader in both our countries with the brands, technology, distribution and ambition to grow and protect more customers. As we look forward, what we've also done, we've sort of sharpened our strategic priorities. Purpose is unchanged to make your world a safer place. We importantly act as the shock absorber at an individual community, business and country level. Our growth-orientated strategy is helping out more of Australia and New Zealand. It's about leveraging the investments we've made to help more people and businesses across our 2 countries. This year, I've spent time in communities across Australia and New Zealand affected by bushfires, by hailstorms, floods. And every time I do one of these visits, it reinforces why our business exists. Frontline team [indiscernible] that matters most and the role they play in helping people rebuild is something, of course, that we are genuinely proud of. And those of you that have been on the tour today saw some of that. Within our strategy, we have refreshed our strategic priorities. Customer obsession from how we attract, serve, support customers and how we grow our business with them, around insurance excellence, technology pricing, underwriting, reinsurance and claims and really getting that all to work together as an insurance company. We're calling this future fit operations, and that's really around how we harness innovation to continue to reimagine a scalable and resilient business over the next 4 years. And of course, importantly, we'll continue to hire and invest in the right people who bring our purpose to life every day. I've had a go here at sort of describing our winning formula. And that's really what makes our business different, but I think importantly also, why that actually even matters. Sort of on one hand, insurance is a relatively simple business, price risk, distribute products, manage claims, and we carefully look after our balance sheet. If you say that quickly, it doesn't seem that complicated. Actually, there's a lot in that in running an insurance company and differentiators really are important. Our customer data set at IAG is one of the most valuable in Australia and New Zealand. And of course, what that does, it enables us to expand and deepen our customer engagement, improve our retention and really help fuel and drive our growth. We've built a modern, scalable technology platform and have the flexibility to grow efficiently, onboard our partners and deploy new capabilities at pace. Also sets us up well as AI integration becomes an everyday defining factor of our business. So as we look around that wheel, when a customer makes a claim, we control much of the experience end-to-end through our integrated supply chain model, including some that we own. And of course, that's good for our customers, but it's also really good for our own economics of running IAG. When a major weather event hits, we move fast, assess impact quickly, and we manage our response. I think many of you this morning saw firsthand how we coordinate those resources through our major event command center. We have leading brands and trusted channels. Customer relationships are reinforced at every interaction across digital, across partner and across our intermediary relationships. And the depth of that trust shows up directly in our retention rates and in the claims experience that we're delivering for our customers. I think importantly, our diversified distribution model is sort of set up for growth and to absorb disruption. We operate -- I'll say this slightly, we operate across more channels through more brands to more customer segments than any other insurer in this market. That's got to be a source of competitive advantage. And the combination of our retail and our commercial businesses gives us diversification benefit that lowers our capital requirements and expands our options around growth. This is our winning formula, pricing risk, distributing products, managing claims, doing this well, of course, and consistently at scale. That's how we've earned and maintained the trust of something like 10 million customers that we currently look after across Australia and New Zealand. And as you can sort of see, growth is going to be -- is a major focus for us. So let's spend a bit more time on our distribution model, which is a key advantage we have in our growth agenda. We serve the major customer segments in this market, club members, individuals, families, rural and regional customers, SME, commercial businesses in our targets. So we serve a lot, and we reach them through clubs, through digital, through bank partners, through brokers and our own regional representation network. Our aim is to be relevant and visible to customers, so we're present wherever they choose to engage with us. We can also grow efficiently as customers' behavior and distribution channels continue to evolve. We have some of the most trusted brands in both countries and a unified platform across the brands, which gives us the data and insights to tailor offers and remain relevant in the world of Agentic search. So, in summary, broad distribution, leading brands and a scalable technology core make us a business built for growth in a changing dynamic external environment. And, of course, we're pursuing the ongoing transformation of IAG, and we're not done. And Neil and Julie and Jarrod and Phil are going to cover this as they talk through their businesses and the changes that are occurring. I think you know that we've been really focused on laying the technology foundations in our core platform to make IAG's operations simplified, consolidated and cloud-based. Our efforts are now more directed at the processes that will improve the customer experience, our claims and sales and service as we continue to transform our business for the future. Of course, AI is going to be a huge part of our transformation opportunity going forward. And the way we're thinking about that is in 3 buckets. And internally, we call them Deploy, Shape and Compose. So deployers put AI in the hands of everyone here at IAG, largely through our technology providers. More than 60% of our people are regular users of AI through the Microsoft, Success Plus and other providers who have embedded AI in their products that we use. And we're essentially democratizing AI for our people of IAG. Shape is where we're tailoring AI to our specific business problems and use cases. And we now have more than 600 activators and have already published something like 90 AI agents that are improving workflows across areas like customer service, operations and across some of our corporate functions. And then lastly, Compose, which we're building for high-value, more complex AI solutions at scale. And right now, we have more than 2,000 of our people that are using Compose AI in their everyday business and in our claims and our fraud and some of our service teams. These are delivering transformational change in the way we are running and operating IAG. And as the team steps you through what we're doing, you'll see many examples of this transformation being brought to life. And let me just finish around some of the metrics that we're focused on and the metrics that we want to be held to account on as we deliver Ambition 2030. We'll have grown our company to one that is over $25 billion in premiums. We'll have achieved an insurance margin and an ROE in excess of 15%, and we will have delivered high single-digit EPS and a stable growing dividend for our shareholders. These are the metrics that will drive the enterprise value of IAG. I'll now hand over to Neil, who's going to take us through more on the technology story. Neil?

Thanks, Nick. Good afternoon all. So I think Nick has already set the frame. We're performing well. We've built a set of assets that are genuinely hard to replicate, a small number of powerful brands, a club member culture at our core and an integrated supply chain. Now from an operational perspective, winning with those assets is all about creating speed, accuracy and scale advantage. So my role today is to talk to the enablers, what we've built behind the scenes to make this possible, particularly as emerging technology reshapes our industry. So I've been obsessed by 2 things, and I continue to be obsessed by them. The first is consolidating and modernizing our core. When the core is fragmented, complexity quickly turns into cost, risk and slow change. So we've been really deliberate about simplification, fewer platforms, cleaner data and delivery that's repeatable, faster, cheaper, safer on scalable platforms. The second obsession is to create the conditions where our customers and our people can fully benefit from emerging technology, including AI. So we benchmark widely. We look globally. We're not approaching this as swapping humans for tokens. The aim here is about experience uplift, about speed and accuracy. So beyond the financials, you're going to hear a lot of stats today, some from me, many from Julie, Jarrod and Phil. And I think you'll feel the level of change that's materializing in our operations from that combination of a simple core and AI at scale. It's a real step change for us, and it's well underway. So to go a bit deeper on consolidation and modernization, the work we've done has set us up extremely well for what's now possible. In retail, we've shifted to a modernized cloud-based core. We've moved from 8 personal lines pricing platforms to 1 from 16 claims platforms to 1. We've moved over 6 million policies to our strategic platforms, and we've got another 2 million that we'll be migrating in the next 6 months. So we've actually moved 27 brands to our common core platform, the biggest platform transition in our history. And it shows in customer satisfaction, which, of course, is the key to retention and acquisition. Over the 3-year migration period, the digital NPS has increased by almost 20% in New Zealand and over 30% in Australia, both up to 57 points. And having gone live with our new CTP experience in New South Wales, we've seen an immediate 27% increase in the Net Promoter Score to 66 points. Importantly, we're also seeing our investment mix shift from spending predominantly on that core transition to spending predominantly on growth and agility. Over the last 24 months, we've seen a 15% increase in policies purchased through our digital channels, now at 65%. Our NRMA and State and AMI mobile apps have been transformed, rating well over 4 stars. And these scalable platforms were a key enabler in growing our business by $1.4 billion of GWP through the RACQ acquisition. So as the Operating Officer, simplification is what makes change repeatable. It reduces duplication and variation and it lifts quality and control. So moving to cloud-based services frees up time previously spent on maintenance. It reduces delivery time lines and it materially reduces operational complexity. Customers feel these changes through their day-to-day experiences. And of course, the bonus is that these investments have created new strategic options for us, winning partner agreements, supporting acquisition opportunities because the core is coherent and scalable. So the replatforming of our direct retail business has been delivered as committed. We are now focused on the seamless migration of our remaining CTP customers and enabling our partners in RACV and RACQ. Intermediated is on a similar transformation journey. It needs separate focus, but the same story is repeating. In broker markets, time creates friction and it creates cost. And we now have our commercial enterprise platform deployed and performing well. We've built multiple broker integration patterns, deployed Guidewire as our system of record and delivered the finance integration. We've commenced moving products and brands to that platform. And from our initial releases, the level of impact we're seeing from the transformation is even more material than in retail. Our first product, Padlock, has more than doubled sales since the same period last year. In WFI, small business quotes have dropped from 24 hours to 15 minutes. And we're now triaging 100% of intermediated motor claims via AI. Whilst we're on AI, continuing the theme, our use does extend right across the enterprise, as Nick referred to. At the highest level, we're organized around 3 opportunity areas, and I'll just run through them. The first opportunity is to target specific areas of the value chain. The examples that I mentioned before, use of AI in our intermediated division to support quote ingestion and claims lodgment are good examples. Likewise, in retail, the claims assessment phase in CTP has been a key value area to target. Second, there are opportunities wherever we can enable the scaled workforce from front office to back office by giving them consistent advanced tools to serve customers better. And third, empowered AI has been amazing to see come to life. We have use case deployments across the entire business through providing people with tools and skills. Our people are amazing at solving pain points, but also at creating new opportunities. Now in terms of the how, Nick described it earlier, but the 3 models -- Deploy, we're really focused on excelling at consuming capability that is embedded and continuously evolving in platforms like Microsoft, Google, Guidewire, Earnix, ServiceNow and more. Our AI activator shape solution, this is about rapid delivery of bespoke agents using our proprietary tooling, Genie. And finally, we build deep industrialized models through the in-house engineering team. In terms of Impact, you'll hear directly from Jarrod, Phil and Julie shortly. But from an operations perspective, we've started to reap the rewards of having taken a really strategic and quite inclusive approach to AI deployment. We've gone from 0 production GenAI use cases 2 years ago to 92 today, and they are not pilots. They are in production. In just the last year, we've doubled the proportion of controls that are automated across the company. And in the Technology division, this is now upwards of 70%. Test Design cycles have dropped from weeks to days. Migration road maps have shortened by around 1/3. And we've unlocked data assets that have been built through 160 years of insurance operations. Importantly, we now have a certified network of more than 600 AI activators right across the business. All of this is squarely in service of better experiences, greater speed, higher accuracy. Now before I move on from AI, just a couple of comments on agentic and retail. There's rightly a lot of commentary about Agentic Commerce. For us, agentic is about faster, more accurate customer journeys where multistep work can be orchestrated within guardrails and controls, of course, and with human oversight as required. And it's feasible precisely because our core is stable and it's scalable. Specifically on Agentic Commerce, to us, just like online and mobile apps, it's another channel to market. And I think it's an attractive one because generative AI tools can synthesize full-service information, not just compare pricing. And that plays to transparency of customer satisfaction, of coverage quality and claims experience, the areas where leading brands win, as you'll hear from Julie and Phil. So from here, the approach is pretty straightforward, focused on the journeys that matter most, embed control and connect the agentic experiences tightly into the simplified core. So back to the big picture. Insurance modernization is hard. It's never really done, but we are well through the heavy lifting. And we're looking ahead, there are a small number of focus areas that we know are absolutely key. At the enterprise and retail level, it's now about extracting the economic upside of our simplification. It only counts if it changes cost, quality or control, and we have plenty of evidence that using AI on top of the simplified core is starting to drive those benefits. Just in my world, we have less work on manual controls and compliance, more change, faster at lower risk, lower cost, migration solutions that can better deal with data variability, improve security and platform resilience. And these are all indicators of an ecosystem that's maturing, turning capability into performance. In the intermediated space, we're early in the brand and business onboarding process, but a lot of the hard work is done. Our technology ambition is really clear to provide the fastest, most accurate experience in the market. The step change in SME quote times is exactly the kind of improvement that brokers notice. No doubt, Jarrod will share more on it shortly. So from here, the focus is on consistent ingestion of information, reduced handling, higher straight-through processing, and that is the winning formula in our commodity lines. So to close, 18 months ago at Investor Day, we promised that this would be the management team that leaned into the legacy platform challenge that we wouldn't pass it on to future generations of leaders, customers or investors. We've delivered the biggest change in IAG's core in over 40 years. We've made the investment. And as you'll hear from William, the mix is now shifting from consolidation and migration to spending on differentiating capability, rapid feature delivery, leading customer experiences. Along with creating market opportunities, modernization has also allowed us to offset increasing costs with lower run and delivery expense. So the next phase is no easier, but it's different and it's full of opportunity. Through both the strategy and to be honest, some fortunate timing, we feel very well positioned. We're seeing a step change in speed and accuracy, and that gives us confidence to be more aggressive in our expectations. And with that, thank you for your time. I'm going to hand you over to Julie for a deeper dive into the retail business.

So good afternoon, everyone, and thanks for joining us. I'm Julie Batch, the CEO of Retail Insurance Australia, and I'm really glad that you got to see a little bit of our operations today. We're a business that's built on customer trust with a deliberate strategy to grow responsibly, to underwrite with rigor, to lift customer outcomes and to improve productivity through technology. And today, I'll share with you how we're creating value, how we're scaling with discipline and why we're well positioned to win through the rest of the decade. Retail Insurance Australia is an advantaged platform with trusted brands, strong distribution and disciplined underwriting. Today, we serve around 6.7 million customers, and we write more than $10 billion in premium. And that scale matters. It gives us the data, the reach and the operating leverage to invest with confidence, and it keeps us close to customers through the moments that matter. We are a multi-brand, multichannel business, anchored by our direct flagship brand, NRMA Insurance and our national digital innovator, ROLLiN. Our partnerships with trusted motoring clubs, including RACV in Victoria, AANT in the Northern Territory, RACQ in Queensland and subject to approval, RAC in WA. And our banking distribution partners, including ANZ, Bendigo Bank and People First Bank that provide us with broad Australia-wide access to those who embed insurance in their home mortgage decisions. We manufacture the full suite of retail products, balancing volume and margin. And with the RACQ and RACWA insurance acquisitions, we significantly improved geographic mix and diversification, lifting capital efficiency and allowing us to sharpen our competitive edge. And the result, market-leading margins above 15% and a customer satisfaction score of more than 55 across our touch points. And if we step back for a moment and look at the last 5 years, the industry has shifted fast. Digital behaviors have changed and inflation has surged and our response has been deliberate, disciplined and calibrated to the conditions. Over the last 5 years, we've simplified and scaled our business. We've positioned NRMA Insurance nationally as a health company. We've acquired the insurance operations of RACQ and RACWA funded entirely through organic earnings. And we've standardized core platforms and built an early data advantage, including a single view of each customer and each insured asset across Australia. And we've embedded AI across distribution, pricing and claims, delivering $300 million in claims and supply chain benefits on an annual run rate basis. So today, we can move faster, we can price more precisely, and we can serve customers with less friction. And critically through this change, we've maintained our financial strength, positioning the business to convert capability into momentum. So turning to momentum. In New South Wales, ACT in Victoria, the home and motor classes have grown strongly. These East Coast states and products are the core of the retail franchise through our flagship NRMA Insurance brand. Today, they represent 66% of retail and 34% of IAG's overall premium. And over the last 5 years, the market compound annual growth rate of these portfolios was 10.8%, reflecting the repricing that was necessary for inflation, supply chain shifts and reinsurance uplifts. NRMA's insurance book, its equivalent book grew 9.6% per annum to $5.8 billion and delivered leading returns through these portfolios. And if we look at that growth rate over the last 3 years, that gap has narrowed. NRMA Insurance's CAGR is 12%, slightly below the market growth of 12.5%, with our home book performing particularly strongly. And we are confident that this strength will continue because going forward, the acquisitions of RACQ and RACWA provide us with better diversification, and a better diversified, more capital-efficient portfolio gives us headroom to grow. It allows us to balance risk across states and classes and provide new pathways to market for more of our products. Aligned to IAG's strategy, we're making consistent choices that create sustained value. We're growing responsibly, lifting customer outcomes and improving performance through disciplined underwriting at scale. We're focused on building exceptional brands and partnerships that earn our customers' trust and expand our share of the household over time. Brand strength drives preference and retention, and this is how we grow. We're leveraging Australian made scale backed by flexible underwriting and sophisticated pricing and disciplined underwriting is the engine of our business. It protects margins and your returns. And we're delivering an effortless experience, particularly in claims by using advanced technology to improve our claims cost while keeping the experience simple for customers. This productivity uplift is long-term value creation. And our opportunity is to keep moving faster than anyone else. We're empowering our people with technology-enabled decisions, a growth mindset and a productive operating model, allowing them to move faster because we believe the future is a game of speed, speed to insight, speed to price, speed to settle and speed to improve, and this will deliver cost efficiency over time. Turning to customer obsession. Customer obsession, it's our profit engine. When customers trust us and the experience is simple and reliable, they stay longer, they buy more over time, and they're more likely to recommend us. The elements that underpin our customer obsession are firstly, scale, which I've already talked to and scale and trust, they're highly interlinked. NRMA Insurance is the most trusted Australian insurance brand 4 years in a row. And our motoring club partner brands are the #1 insurer of choice in their home states. That trust gives us access to a large, high-quality customer base today, and that trust is also critical tomorrow in an agent-to-agent world. Scale then creates efficiency advantages through data that powers our digital platforms. If you're one of the 65% of our customers who buy online, you'll get a quote today 50% quicker than the same time last year. And that efficiency improves customer experience and it lowers marginal costs. With better scale and efficiency comes pricing sophistication. We respond in real time to changes in risk, and we're much more targeted in our risk selection. And with our 100 years of history, we understand the value of a customer across their lifetime. And this is how we create high-quality, long-term value and earnings. And those capabilities in turn flow directly into market-leading insights. We capture touch points from all of our interactions, including more than 7.9 million voice calls per year. And it's this vast deep knowledge that drives our customer experience, reinforcing trust and advocacy in our brands. These are the moments when our differentiation is earned. And the result of this equation, it's higher quality growth. We see this in renewal frequency, which has improved 3% and targeted acquisition focused on the customers we want to keep for the long term. Returns are then reinvested back into the customer experience, strengthening brands, improving digital journeys and lifting claims performance again and again. This foundation is what allows us to scale with confidence and deliver you consistent market-leading returns. So let me bring our strategy to life for a moment through our portfolio because this is where insurance excellence shows up. We're shaping a portfolio that's resilient and connected. So we price risk precisely, we serve customers consistently, and we put capital behind the best opportunities. Each product has a clear role to play. Motor is our historic foundation. It's a scaled product where operational excellence matters. And we're focused on trusted distribution and integrated supply chain and consistent claims execution because that's what sustained advocacy and margins over time. And here, our proof point is clear. We're at 61.5 points of customer satisfaction for our motor journeys. Home drives customer loyalty, and you can see that translate directly into persistency with a 95% renewal rate. Customers trust our brands and service, and we price and underwrite with discipline, so we retain the right customers and we protect returns. And this is where our capabilities in perils pricing and in our claims response are a durable advantage. CTP is our gateway to new customer growth, a powerful relationship builder, especially with younger drivers. It's a bridge to a broader NRMA insurance relationship. And today's CTP customers, on average, hold 2.49 policies. It also gives us vehicle visibility that deepens the motoring club insights that we already have, but it only creates value if it's profitable. And in this class, our pricing excellence and capital management have delivered over the long term. Small business helps us expand from protecting customers' assets to their earnings, and we've seen consistent volume uplift. Today, we serve more than 120,000 small businesses across Australia, many of them also holding other personal products. And finally, our niche product helps us meet more customer needs and deepen relationships, expanding our role from protection to lifestyle. Our multiproduct portfolio lifts retention. It improves lifetime value, and it allows us to invest more confidently in service and in innovation because the economics compound. And critically now with a broader, better balanced geographic spread, we can extend these products to more customers across Australia. So the future of our operation, it's grounded in technology, taking all of that capability that we've built through the enterprise platform and using data-led technologies to accelerate outcomes for customers, lowering unit cost through automation and speed. And we're already using AI extensively across our retail business, powered by that incredible scale of our data. It's improving the underwritten quality of our book. The fraud detection platform we've built has delivered a 125% improvement in preventive loss over 5 years. It's increasing our speed and productivity. Using deterministic AI, we've improved claims cycle times by 13% and using AI agents in CTP, we've halved the decision time to the second liability decision. And these faster decisions, they free up our people to spend more time helping customers return to health and work. Our telematics capability has provided over 100 million kilometers of driving information from both ROLLiN and NRMA Insurance. And this is informing us about road risks that support safer driving outcomes and creating a platform for more personalized engagement. And finally, our API connectivity honed with our partners sets us up for an agentic future, including agent-based distribution as that capability matures. We're building on the enterprise platform and industrializing AI across our organization, preparing our teams for the change that will come. So looking towards 2030, our 2030 Ambition is grounded in scale, in value creation and in disciplined underwriting. We're targeting 8 million customers, driven by organic growth and the inclusion of RACQ and WA. And this will deliver $15 billion of premium for IAG. Through AI and automation, we'll lift our claims saving run rate by $500 million per annum, giving us confidence to deliver a consistent 15% margin over time. Experienced leadership and data-driven scale are our competitive moats, lifting retention, lowering acquisition costs and improving risk outcomes. And as Australia's largest retail insurer, we have the scale to lead the discipline to perform and the capability to transform. And with that, I'd like to hand you across to Phil Gibson. It's the first time you're going to hear from him, so he's going to tell you a little bit about himself and a little bit more about New Zealand Retail.

Thank you, Julie. Kia ora to everyone. I'm Phil Gibson, and I'm thrilled to be here representing the New Zealand business. Over the last 11 weeks, I've been immersing myself in the country, the culture and the business, meeting with partners, customers, stakeholders and regulators. This has reinforced the reasons I'm excited to be here. I see a strong business with solid fundamentals, good alignment across the team of values and objectives and significant upside from which we can grow. I come with deep relevant experience over 3 decades in general insurance. I've spent my career helping insurance businesses grow, modernize and perform at scale across the U.S. and Canada. I've worked in both personal and commercial insurance, ranging from startups to some of the largest insurance companies in North America, including Travelers, Allstate and Aviva. I've led major performance transformations and my experience spans underwriting, pricing, operations, claims, distribution, data and AI. And prior to IAG, I worked in a very large consulting firm advising senior insurance executives on strategy, technology and AI. My passion has always been strategy and execution, building high-performing businesses that combine talented people, great customer experiences and long-term resilience to generate exceptional financial outcomes. As I see it, the opportunity here is to take this business from being good to great. I'm going to talk to you first about the retail business, and then I'll come back to talk about the intermediated business after Jarrod. Our retail business is the personal lines market leader. Our brands are among the most trusted and established in New Zealand. AMI is the leading direct brand in the market. And this month, it will celebrate 100 years in business, and it's actually just the baby of the bunch. State is the third largest direct brand in the market. It enjoys widespread brand recognition and it's 121 years in business this year. We also serve customers through our major bank partners. Together, this gives us a tremendous breadth across the market, generating more than $2 billion in GWP and proudly serving 1.7 million customers. We represent over 1/3 of the personal lines market. And the headline here is that we are growing. In the first half of this year, we grew our market share in an otherwise flat market. And our customers are happier. We've proudly achieved an impressive 7-point lift in NPS across all of retail since July as a result of our actions. Our opportunity now is to reach new customers and deepen our relationship with existing customers. And we'll do that by building on our growth momentum, simplifying customer experiences and continuing to scale our hub businesses, which offer services beyond insurance, all to deepen our customer relationships. Our strategy is to continue building growth momentum as market conditions improve. We expect the New Zealand personal lines insurance market to return to growth after 6 flat quarters. This growth will be driven by a combination of moderate system growth of items and very modest rate actions. We are closely monitoring geopolitical events and can respond quickly to claims inflation. To date, cost pressures have been modest. We're seeing some minor increases in motor parts, and we're responding accordingly. And we'll recognize and we'll respond to changing customer preferences as well. Customers increasingly expect simpler, more digital, personalized experiences at a price they can afford. At the same time, AI will fundamentally reshape how customers interact with insurers, particularly how they discover, compare and buy insurance. And we're already seeing signs of this shift. For example, AMI and State have seen changes in organic website traffic as more customers find what they need via AI summaries. So our digital content must ensure that our brands are visible and well represented to LLMs. Looking ahead, emerging AI native agents and aggregators will help customers interpret policy terms, benchmark products and proactively monitor the market for better terms. We see this as an opportunity, not a threat. In response, we will leverage our strong brand propositions as trust will remain a critical factor. We'll deliver simple, digital and more engaging personalized experiences. We'll ensure we have sharp competitive pricing, which is always going to be a key part of the purchasing decision. We'll increase our operating agility to respond to a more dynamic competitive environment. And as you're hearing the recurring theme, we'll scale AI as a strategic capability to help us grow and increase productivity. Let's talk about the strength of our brand propositions. AMI has been the primary driver of growth for New Zealand retail this year. Just like our member clubs, AMI offers a range of connected services. Our free AMI roadside rescue service offer is unique in the market, and it is having a proven growth impact. It was rated #1 roadside service by Consumer NZ, proving it's not only free, it's a better proposition. We're adding further value through discounted motor servicing and road fitness tests using existing capacity to extend the proposition and deliver the service. The impact on the AMI brand in a short space of time has just been exceptional. And we know from our experience in Australia, the halo benefits a member brand can bring. AMI strategic NPS has lifted 5 points since first quarter, a huge shift and a metric that's notoriously difficult to move quickly. AMI is forecast to grow personal lines items by 8% by the end of FY '26. Now about 60% of this has come from the AAON deal, giving their customers the opportunity to move to AMI. And thanks to the strength of the AMI proposition, the majority are saying yes to the offer. We're seeing similar increases in building our noninsurance customer database -- customer base, serving over 11,000 customers to date. It's been so successful. We plan to launch 2 new stand-alone mechanical repair sites in Auckland this year on top of the 10 AMI MotorHub and 6 AMI HomeHub locations we already have in place. This vertical integration not only helps deliver a seamless customer experience, it does so with superior economics for us with internal motor repairs costing 20% less versus similar third-party repairs. AMI and State can create more personalized and engaging experiences through our digital apps. Over 60% of our customers are digitally registered and around 30% have downloaded the app. To date, our app offers always-on convenience in your pocket. You can open and book roadside rescue and track the vehicle on its way to you. You can amend or renew your policy and half of our app customers now elect to pay using Apple or Google Pay. You can also lodge a claim. In fact, I recently had a rock strike my windscreen, so I was able to experience our touch-free service for myself. I lodged a claim in our app. I selected a location, a time and date that was convenient for me. I dropped my car off, came back after lunch and drove off with a new windscreen, amazing. We also offer proactive notifications like weather events and even marketing offers. And as we continue to expand our capability, these experiences will become much richer, like faster claims experiences where our customers simply upload photos for instant assessment, assignment and scheduling of a claim. And soon, offers to help manage your car or your home with a range of risk prevention services. Increasing the appeal of digital service, it's not only great for customers, it lowers our cost to serve. So this will be a key priority as we move forward in 2027. As Neil mentioned, our retail business is at scale on the modern platform, enabling pricing precision, speed and cost efficiency. We have almost 2 million policies on the platform, and we're unlocking operating efficiencies from reduced system complexity, removing both cost and remediation risks, bringing our AMI and State teams together in a single sales and servicing team. We're also leveraging the Earnix pricing platform and using risk-based pricing. We now price at a much more granular level with the ability to refresh pricing fortnightly, ensuring we remain responsive to loss trends and cost pressures. Automated underwriting decisioning is improving speed and consistency while we're maintaining our strong risk discipline. To date, we've removed over 200,000 manual referrals to underwriters. We're now at 90% straight-through automated decisions for personal lines, and we're targeting 99% straight-through processing for motor and 95% straight-through processing for home. In claims, our supply chain scale is delivering clear cost benefits through greater vertical integration and repairs, stronger partnerships with motor parts suppliers and our procurement scale, we're materially improving claims unit costs and customer repair outcomes. And as we all know, continuing to drive down the underlying cost gives us more margin to reinvest in growth. So similar to what you heard from Neil, our investments in Technology have created an excellent foundation for us to scale an AI-led transformation. Our business is ready. Around 90% of our data has been ingested on Google's data platform, giving us a single scalable source of truth. That matters because AI outcomes are only as good as the data that underlies them. We have modern cloud-based platforms from several key systems partners, including Guidewire, NICE, Microsoft, Earnix and Google. That means we get out-of-the-box AI capability and evergreen updates, allowing us to focus on building our AI strategic capability on processes that matter most to us and to our customers. Beyond the technical foundations, our people have experience with AI. We have active AI use cases being widely used in the business. As an example, our knowledge helper agents and claim summary agents assist our frontline employees in delivering faster, accurate answers to customers. These tools, combined with targeted process reengineering have cut our average claim settlement time in half, getting our customers back on their feet faster. The business and technology are working closely, building AI agents that unlock increased productivity, efficiency and workforce flexibility within clear guardrails. And now we have a clear opportunity to accelerate, moving from good individual use cases to a systematic enterprise-wide AI transformation. For the last 2 years, I've been helping clients leverage AI to seize opportunities and solve so many problems. If there's been one consistent predictor of success, it's that widespread AI transformation works best when it's CEO-led. Based on my experience and what I've learned so far, there is a fantastic opportunity to transform our business using AI as a true strategic capability. It's early days, and I look forward to sharing more on this in our next update. Overall, even in uncertain times, our retail outlook is positive. What gives me confidence is that we have an AMI proposition that's winning in the market. We have a multi-brand portfolio that gives us scale and breadth. We can deepen customer relationships through our Hub services and by unlocking the full value of our data with a single view of the customer. We'll continue to obsess over the customer and build richer digital experiences and lower our cost to serve. And as I mentioned, I see a huge opportunity for us to scale AI strategically across the business, increasing operational agility and productivity. Together, this means we can deliver growth and margin. And finally, our highest priority is disciplined execution, strengthening a market leader today and extending that leadership for the long term. Thank you. I'd now like to invite my colleagues up to the stage for Q&A. And as they come up, we'll show a short video that brings our AI journey to life. [Presentation]

Thanks, team. So just how we're going to run this now is, we'll just do -- we've sort of broken up questions into 3 little buckets. So we've got a break now for 20-odd minutes. Then we'll hear back from Jarrod and Phil, then we'll open up again for questions on sort of the intermediated commercial businesses. And then William is going to come up and talk about some of the financial and reinsurance aspects, and then we'll open up for questions again. And I'll sit on all 3 of those panels, just so we can sort of manage questions as we go along, don't have a load of them after a couple of hours of presentation. So why don't we just open up? And Mark's in the room -- for those on the video, Mark's in the room with a roaming mic, and he'll be sort of directing to the traffic here. Over to you, Mark.

Kieren Chidgey from UBS. Nick, I might start on Agentic Commerce. It was mentioned a couple of times there. Just keen for you to unpack in a bit more detail how you're currently thinking about it. We've clearly seen a reluctance to support price comparison websites for the obvious reasons historically. But it sounds like you want to lean into some of the agentic apps that no doubt will appear here soon. Is that going to be brand specific? Is it going to be across the bigger brands like NRMA? Are you going to open up pricing engines to these apps? Can you just give us a feel for why you're comfortable sort of leaning into that and why you're not going to commoditize what is a very strong brand?

Yes. Thanks, Kieren. I mean -- and I'll ask the team to come in and -- to give us a bit of support around sort of bringing that to life in some of our brands. And the sort of the macro is going to have to be that we're going to meet our customers where they want to be met with insurance needs. I mean either that's through a broker, an agent, an authorized rep coming in direct, either through an NRMA or one of our club partnerships or financial institutions. So we kind of have -- I mean one of the great advantages of our business model is that we are set up for that. I think that is just an extension of that story, this topic, which is we're assuming over time, more and more consumers are going to want to buy their insurance products, particularly direct, particularly retail. But I think we should save that question also for Jarrod and Phil when we talk about Intermediated and Relationships with partners. So maybe we'll park that for that part of the discussion and just concentrate on the retail. I think the reality is that we are going to engage. And I think that -- I mean, Phil sort of mentioned that in a way, it's not the same as a price comparison because it's going to be able to look at the full strength of your proposition, your wording, your price, your -- the capability, your claim strength, actually what your brand stands for. And I think those -- not just in our sector, but just as a general theme, those companies with strong brands, with strong relationships that stand for something. I think in a sort of a changing environment, a changing e-commerce world, they're going to do well. I think if you don't have those things, then that's going to be a problem for you. But actually, that's not IAG. I mean our retail brands have got many of those things in spades. So I think actually, there's an opportunity to bring that to life more, but maybe how [indiscernible]. Julie and Phil, maybe just sort of bring it to life and how you're thinking in some of the brands.

Sure. I mean we've got pretty strong, pretty well diversified distribution now. So it's direct, it's digital, it's call centers, online. We work through partners. We've got incredibly strong APIs. And so when we look at the opportunities, the risks and the opportunities through agentic, we see it as another channel. I think it's too early to say whether the pricing engines will open up. I definitely think you'd want to price. It may actually make some of our data more defensible. And so we're really kind of focused on being ready for that and prepared for the way that our customers want to meet us, as Nick said.

Same. I think I'll just be echoing the sentiment of, we want to meet our customers. We want them to be able to come through any door they want to come to us. AI agents, I think it's not something that we're afraid of. We see this as another opportunity for customers to get to know us better and get to know our true value, not just the price, but the whole -- what we offer. And I think we'll outperform our competitors when they do that.

I think -- just a close for me, just the authenticity of our brands, I mean, they really are real. I mean we talk about it a lot. I think people in this room and on the video would know that. We're super proud of the way we show up and look after our customers. And I think that gets more exposed in this world. So maybe this is going to turn out to be -- I know there's concern, actually, it may be a positive.

Nick, can I just add one comment. I think there's sort of 2 aspects to how we show up. One is being visible and clear and having a digital presence that can be accessed by others. The other is the actual agentic execution within our tool sets. And I think perhaps some of what you're hearing and the confidence is that if we were in a position where we had 10, 12, 14 claims policy pricing platforms, our ability to expose that consistently externally and actually support those new channels is very, very difficult. And so some of the sort of confidence you're hearing, I think, is because having done the consolidation work and gone retail first, we feel like we actually can really focus the energy and effort to supporting those channels in a much cleaner kind of way.

This [indiscernible]. Last week, both APRA and ASIC wrote regulated institutions regarding one of the latest AI models. How are you embracing that in your technology stack?

Yes. I mean I'll make some comments here, and there's sort of a whole lot of topics in those. And those who are not familiar with those letters were really around the governance, the systems and process, which financial institutions that are running AI and sort of putting the whole financial services industry on notice essentially sort of look after yourselves and look after your customers really. I mean -- so it doesn't feel like that was new, the issues that were being raised. And I mean it rightly does raise a whole lot of things. I mean the starting point for us, though, is pretty good. because what you don't want to have is an enormous amount of complexity in your business in the first place that you're trying to tap things onto. And Neil sort of answered it before when we were talking about sort of answering Kieren's question. But actually, we feel like we've got sort of the house in order, and we're well on the path to have that. Now that doesn't mean that these issues aren't real, but it just makes it a bit easier to line ourselves up. But then it's all about how we're thinking about the governance, how we're deploying. You can see it in the way we've got a methodology to deploy. This is not a random walk at IAG. We've really been thoughtful about how do we get 15,000 people excited, but then how do we govern and ensure that we're structuring and controlling that and putting guardrails around it. I mean I'll just ask Julie, another sort of aspect they didn't raise so much in those letters. It's really around sort of the ethical concerns that sometimes come out of this topic. And we've given some thinking around that as well as around just making sure that we don't inadvertently exclude people or somehow in sort of desiring to do something good for a customer end up not. And Julie, you might want to make some comments around that.

Yes. I mean just for your information. So in 2019, we founded an institute called Gradient Institute. It was a collaboration between Sydney University, ourselves and the CSIRO. And that institute is around looking at building ethics into algorithms. It's released a lot of research. It's had a lot to do with how the government and various different organizations have built regulation and risk into their -- the way they put standards out. So I'd encourage you to do that. And we're using -- just have a look at that website. We're using a lot of that information in the way that we're building out our algorithms and AI applications now and making sure that we're leaning into the ethical, repeatable, reusable side as much as the opportunity.

Just a few things for me. I think this idea of inclusiveness around these tools is pretty important to us. So this is not kind of a small center of excellence type capability. That's probably a fast path in the short term. But actually, the long term here is to have an organization that has a culture awareness, understanding of responsible ethical use, but also a level of governance and control around how we deploy these capabilities into production that is really stringent. And you'll have heard -- you probably -- some of you have picked this up. In the video, there was a comment about 700 agents. And when I was presenting, I talked about 92. That's actually the difference between those that are in incubation, creativity, experimentation and those that we've gone through the validation, verification and control process to be comfortable having them in production in our organization today. So again, this language and categorization is all about the level of governance control and risk associated with different models, the level of business continuity we need to have around them and so on that gives us that sort of framework to step into this space.

Simon Fitzgerald here from Jefferies. Just a wider question on AI. Obviously, the adoption here is absolutely fascinating. But what's also interesting is just the speed at which they can be deployed. I think there was a comment made before that productivity through technology is our long-term value creation. I'm interested to know -- I suspect that a lot of insurers will be using these and it just becomes a standard as opposed to anything else. Like could you make some comments about how you see this as an advantage longer term, Nick?

Yes. I mean I'd say one-off, not the source of competitive advantage. I mean the point is right that we're not going to be the only financial services, only insurance company that's embracing this topic and deploying at a pace and looking for sort of productivity efficiency, customer -- improved customer experience. I mean what we also know is our industry has got lots and lots and lots of legacy systems and lots and lots of things that don't talk very well to each other. And I mean, Neil sort of stepped us through that, that we've done some heavy lifting here. Now that doesn't mean that the next step is -- we're there already, but it does make it a bit easier. And we've also -- we went retail first on how we've deployed this and how we've really sort of put a new platform in place. But we do feel like our capacity to engage, build sort of the next step change, which really feels like it's happening now. We've kind of got the building blocks set. And I'd say probably more set than others. However, the point is also right. But no doubt everyone else is also thinking about how they can accelerate whatever plans they've got and embrace this. It's just a bit easier when we've got our assets lined up. We've also got the scale. And I think that really is an advantage because across Australia and New Zealand markets, we've got wonderful insight and history and data and understanding and our capacity to this technology and capability really allows us to use that knowledge to a greater extent. And if you've got it like we do, I think that's got to be a source of competitive advantage.

So I think that call around just the power of our data. I mean we have abstracted our data from every core system. We've organized that into information about a house, a car, a person, and whatever that might be. And we don't need to ask the same amount of questions as others might because we already know the answers to those things. And I think that gathered over decades is quite unique.

I might just throw it to Phil because Phil worked in the industry for 30 years and stepped out for 2 and turned on to the other side, giving us advice and then sort of saw the light and came back luckily. And what's your observation of us, but also what you've seen across many other insurers?

Yes. I think generally, when you start this journey, the big questions are, well, how is your data? Because if you want to train models to make decisions based on your data, if it's not clean, consistent, accurate, you're going to get bad answers. And then how is your processes? Because if you're going to use AI models to automate or take humans out of the equation and do these processes, if they're inefficient, you're just automating bad process. You're just going to make it go faster, which is going to make it worse. So then the third one is, do you have the fundamental technologies in place, generally cloud-based to do these things that you want to do. And IAG is unique and that we can go, yes, yes, yes. So that to me is quite the accelerator and great foundation to start from.

Okay. It's Nigel Pittaway from Citi. Just slightly changing tack. Just wanted to ask that with your modern tech stack and 61.5 tNPS in motor, do you think your difficulties in Australian motor unit growth are largely over?

I mean some thoughts, and I'll ask Julie to come in as well. I mean we sort of showed those -- that great slide, I think, for New South Wales and Victoria for NRMA and RAC. This sort of shows the market grew just over 10% and us just under that. In the last 3 years, actually, it's not as -- it's even closer. So I wouldn't characterize it the way you said. I would say that we know that our price point has been -- has been challenging that we know that, that's been tougher than home. And we know competition has been pretty heavy in the motor classes, particularly in New South Wales and Victoria. What we can also see, and we made some change, and I'll get Julie to make some comment now that actually, we've turned that a little bit. And maybe you can come in rather than me saying more.

Sure. So if I look at the direct business in Australia, across New South Wales and Victoria, we've seen a little bit of volume loss as we said in motor. Victoria, we've explained before because of the conditions in the market, we've been holding our share there. And in New South Wales, it's been new business growth. So we've put a lot of work in over the last 6 months to kind of turn that around and reshape some of that portfolio, and we're pretty comfortable with the way it looks. I mean we're always going to be selecting the risks that we think meet our risk profile and bringing in RACQ and we've got growth going through South Australia gives us a bit more ability to balance. We've sharpened some of our marketing. We've reshaped some of our media spend. And so we're feeling comfortable with the outlook.

Siddharth Parameswaran from JPMorgan. Just a follow-up question on growth -- aspirational growth ambition. So I think you've got a target, particularly for RIA of $15 billion of GWP ex the acquisition. It implies around 5% growth. You're expecting the market to grow at 6%. Are you still targeting -- it seems that it's a revised target of below market. Am I reading that correctly?

I think you're overthinking that. I mean as a general theme, the 25% is sort of, let's say, the current run rate of our business -- sorry, let's pick -- for June '26, let's say the business is writing about 18.5%. Actually, the run rate is more than that because it's got RAC -- an extra 2 months of RACQ in it. So let's call it 18.75% or something like that. That's today -- that's our business right now. That's a shift on really -- what we're really saying is we're going to grow that roughly at 6% plus the inclusion of RAC and WA. That sort of run rate business plus the inclusion of WA gets us to the 25% and a version of that is each of the businesses.

Sorry, my question was specifically about RIA targets, but...

Within that, it's the same sort of -- it's the same math. It's the current run rate. We've got an extra couple of months -- extra 2 months of RACQ because last year we only had 10 months and then 6% plus the inclusion of WA.

So sorry, you're targeting 6% organic growth?

Yes, we're saying...

That's what you're hoping to...

Actually, what we said is we're targeting market growth -- the assumption on market growth, which is what we put up on there was sort of 6%.

I mean the only reason was it specifically before you had targets of aspiring for market share for market growth, but it wasn't particularly...

I think we can [indiscernible] to market growth. So we're projecting outwards to FY '30. We're expecting the market to grow about 6%. We're saying that we will grow organically at that level and bring in the RACWA and the full run rate of RACQ. And it might be in the rounding. So I wouldn't score...

Well, my numbers are around 4.5% versus your 6%. So over the 5 years, that compounds to a difference, but it's sort of consistent?

Yes, the same as the one Julie said. So that might be rounding because that is what -- the story is the one I said.

Okay. Fair enough. Okay. And just -- I mean, the chart you showed on NRMA in particular and growing close to market, just where have the difficulties been by State? If you could give us some help in understanding? And yes, what actually happened in those other areas?

Sure. So I mean, we've given you the publicly available data from a CAGR perspective from that perspective, so you can check that. We've shared our NRMA position just to try to give you a bit of a sense that in our home states, they're growing. Obviously, in Queensland -- if we look at Queensland from the NRMA book, it's a little behind. We've been very focused on RACQ, and that will be our growth engine going forward, and that is going pretty well ahead of our targets on growth. So we're pleased with that. In South Australia, we've transitioned our brands to NRMA. We've got home and motor volume growth going through South Australia that we're pleased with. It's also supported by the CTP book. And in WA, our shares have been more muted. We're obviously, again, focused on the RACWA acquisition there. And again, that would be our future growth lever through that market. Across the country, home has grown strongly. So it really has been a motor new business story, particularly in New South Wales.

Freya Kong from Bank of America. Just a follow-up on Sid's question and your outlook and confidence in market growth over the next 5 years. I think under -- addressing under insurance has always been a structural growth driver that the industry has pointed to, but affordability is getting worse, not better. And we've seen instances of the government having to step in to help with that with the cyclone pool. Any steps you can take as an industry to address this and drive the growth?

No, I think there's quite a few. And we're certainly working with government around this topic. And I think we'll probably hear a little bit about that in the budget tonight and tomorrow around sort of putting some money away to sort of do some more exploring with the industry around what we could do. And we don't -- and it's not good for our country, and I'd say something similar for New Zealand around sort of this excluding an element of the population that has sort of ended up with being exposed to sort of certain risk predominantly around natural perils that sort of exclude them from insurance. And so I think there has to be -- that ends up being a country issue. One thing is the industry knows a lot and IAG knows a lot and it's very helpful with the government is trying to work through what could be done. And we are definitely working with the right people around -- with other members of the industry and the industry association around what potential solutions could be. I mean, Julie is heavily involved in this topic. I mean, you might want to make some comments around HIPP.

Yes. I mean the ICA is very focused on bringing the industry together to collaborate on how we might increase availability, if you like, particularly in some of these flood challenged areas. There is a group called the Hazards Insurance Partnership. That brings together almost every department of government, I would say, and most insurers to try to have a look at what we might be able to do to change affordability in some of those spaces and availability. So that work is underway. Obviously, the work that we put into our technology and simplification will help us be more cost efficient over time, and that's really important to us. So those are the areas as well we're looking from an affordability perspective.

Andrew Adams from Barrenjoey. Can you just help me understand where the benefits of AI come through for investors? I guess, looking at guidance, and I'm going to bog down on the rounding, but it does seem to imply a recovery in premium rates in retail, but flat or lower margins in retail because it all looks to be coming from Intermediated. So I would have thought AI, I'd get some expense savings or the ability to reinvest back into premiums, but where am I seeing AI in the financials?

I mean my sense will be, obviously, it's not just going to be IAG, right? It's going to be the market. There's going to be wholesale change, I think, in sort of cost structures that could occur over the next sort of 5, 6 years that hopefully go to affordability. And so maybe some of this gets -- some of the discussion we just had around the affordability of that. So, it's not good for people to be excluded from insurance. So actually, this may be helpful because I think risk is on, remember. So yes, AI is going to probably help with some of our expense cost structures, productivity efficiency and against that risk is on. And so the products...

So if we're successful in AI -- so if we're successful in AI, the industry growth arguably over the next 5 years could be closer to 0 or much lower than what it's historically been or...

I doubt that because I think risk will continue with obligation...

You doubt that it will be successful or you doubt that there will be low growth?

I doubt there will be low growth. I'm confident the industry will be successful in deploying capability to improve customer experience, take some inefficiency out of the way the system works. both right across the system, by the way, not just in the -- I know we're talking about retail now. Against that, I think, one, that could actually be helpful so that may expand the market because it goes to affordability, so more people can actually buy insurance. Against that as well, I think risk is on. So yes, there may be some productivity efficiency from a cost point of view. Against that, I see the risk profile of our country only going one way, which is up. And that's why I think the net of that, we're sort of forecasting at 6%. My view is that's likely to be low. And my sense would be that we'll end up having at an industry level premium growth at or above that. Mark's given me the wind up. Thank you, panel, and thanks for the questions. And we'll roll now into the other part of our business, our Intermediated business, start with you, Jarrod. Thank you.

Good afternoon, everyone, and thank you for joining us. Today, I want to do more than just share numbers. I want to share the story of how CGU and WFI are shaping the future of Intermediated Insurance in Australia. But before I take you through our strategy, I'd like to answer a question I'm sure a number of you want answered, which is how confident am I in our capability to navigate the commercial insurance market cycle, which has softened since this time last year? I've seen many of these cycles over my career. And since first joining IAG, I've become really focused not just on rebuilding the foundations of this business, but on preparing for this softer phase of the cycle. The investments we've made in strong underwriting discipline pricing sophistication, people capability and operational efficiency position us well to deliver through the cycle. We have strong reputable brands in CGU and WFI, diverse portfolios and channels to market, not all of which are as exposed to the cycle to the same extent. And in 2025, we were very deliberate in taking costs out of the business and restructuring around a functional model to drive operational efficiency, and that will be fully enabled with AI. Since exceeding our $250 million profit milestone in 2024, we've demonstrated the ability to achieve half-on-half stable underlying margins. And today's capabilities position us well for the cycle we are in. But our ambition is much greater and our in-flight strategic investments in AI, process and technology transformation and broader capability uplift put us on track to achieve a sustainable 13%-plus insurance margin by 2030. And by then, we will have taken out at least 3 percentage points of cost to run our business. We will also have more agile connectivity to our brokers, the ability to bring product innovations to market quickly as customer needs change. Our focus hasn't shifted. We're committed to hitting our annual financial targets, managing margins through the soft market and transforming our operating model. These aren't just aspirations. They are actions that drive outcomes for our customers, brokers and shareholders. IA operates with meaningful scale across commercial, SME, Agri and Personal lines, over $4.5 billion in GWP. And that scale and quality of partnerships allows us to invest in data, AI, process transformation while maintaining our underwriting discipline. Growth here is intentional and targeted. This and our foundational insurance capability already delivered provides the confidence in achieving these targets. Across the industry, expectations are moving quickly from customers and brokers. They're looking for speed, consistency and relevance, not just price, and that's shifting the basis of competition. At the same time, Technology, particularly AI, is reshaping how we price risk, select business and serve customers. And that's right across the value chain. Alongside that, the risk environment remains complex and increasingly dynamic, which raises the bar on execution. Our response is deliberate. We're investing where benefits compound in capability that strengthens over time, in efficiency that is structural and in control that is built into how we operate. Our vision is to be recognized globally as a leading intermediated insurer. We're focused on the areas that mattered most, growing and succeeding in our market, leading with customers and brokers, driving operational efficiency, embedding risk control by design and engaging our people. We've set ambitious targets for 2030, a plus 13% plus insurance margin, #1 in NPS across WFI, CGU and claims. A 10% admin ratio, 100% straight-through processing on SME, Agri and Personal lines. 90% plus automated controls and an outstanding employee engagement score above 78%. These aren't just numbers, they are outcomes that reflect the discipline and delivery we're embedding across the business. How are we going to get there? We're going to focus on 4 priorities: Customer Obsession, accelerating growth and expanding our market by delivering exceptional customer experiences; Insurance Excellence, driving underwriting excellence, leveraging data and generative AI and ensuring capital efficiency and governance; and Future-Fit Operations, redesigning our control environment, building a platform for profitable growth and striving for operational excellence; and Exceptional People, outcome-driven, exceeding customer expectations and fostering a culture of engagement and consistent innovation. Let's look at some of these in a little more detail. What really drives our ambition is our obsession with customers. Today, we're delivering measurable results. Our cost -- our broker pulse scores is up, claims NPS is rising and retention rates in preferred segments are improving. These aren't just metrics, they're proof that our customer program is translating into real value, more GWP through higher retention, lower cost to serve, fewer complaints, targeted GWP growth and elevated customer experience. We've set the foundations. Our CX team has established. Customer experience is built into our commercial enterprise platform and AI journeys, and we're tightening measurement so we can manage it like any other performance driver. In insurance, customer experience, especially at claim time is what builds loyalty and uplifts retention. This is about growth, not just marketing. Looking ahead, our ambition is to completely embed customer obsession into our organizational DNA. We're integrating digital and human channels, delivering tailored products and solutions that reflect emerging risks our customers are facing. What really sets us apart is our commitment to insurance excellence. Our pricing sophistication continues to evolve, enabling us to better price risk and deliver underlying margin. This is about strong risk assessment, agile underwriting that drive improved margins across our portfolio. We've laid solid foundations, underwriting and pricing discipline, robust reinsurance protection and strategic data asset building. Looking ahead, we're accelerating the build of our underwriting function of the future. We're delivering new tools like the underwriting workbench and product factory and optimizing our portfolio. Our Ambition for 2030 is clear, fully integrate AI-enabled risk assessment and underwriting, develop continuously evolving pricing mechanisms, evolve our risk appetite to serve emerging customer exposures. Operational excellence is the engine behind everything we deliver. We've established and embedded our operations function, redesigning end-to-end processes, and we've started with claims and launched skills and capability uplift programs across the business. We're automating claims lodgment and validation and our CEP delivery is on time and on budget. Looking ahead, we're continuing AI-enabled automation across all remaining processes. We're completing CEP delivery for all planned lines of business and processes and integrating redesign work across the value chain. Our Ambition is to recognize all benefits from CEP delivery, the operating model changes we've already implemented and the broader tech modernization we'll step into. We're shifting from manual detective and corrective controls to automated preventative controls, making our business more resilient and more efficient. Let's bring it all together and look ahead to our ambition for 2030. Our target is clear. We're aiming for a 13% plus insurance margin by 2030. It's not just about hitting number. It's about building a business that's resilient, relevant and ready to lead. We want to be recognized as a leading commercial insurer. We're transforming our technology stack, enabling us to capture disruption opportunities as they arise. This is a deliberate reengineering of the insurance value chain. We're investing early were advantaged compounds, data, AI and process redesign. These investments are already delivering results, and they'll continue to drive value as we move forward. Aligned product and service propositions will enable us to gain market share, and we'll see a 3 percentage point improvement in our cost to run the business. That will be tangible progress and a measurable outcome that our strategy is delivering. As I wrap up, I just want to leave you with a clear sense of where we're headed. We're not just aiming for financial targets. We're building a business that's resilient, relevant and ready to lead the industry. Our actions are deliberate and future focused. We have momentum. We have confidence, and we have a clear plan to deliver on our 2030 ambitions. I thank you for your time and attention today. I'm going to pass back to Phil and he's going to take you through NZI intermediated business and New Zealand plans. Thank you.

Great. Thanks, Jarrod. Here again, everyone. I'm excited to be back on stage representing our intermediated business in New Zealand. NZI is New Zealand's leading commercial insurer and we serve customers via our broker network. The NZI brand is 167 years young with a storied history and we enjoy strong long-standing relationships with our broker partners. So first, I'd like to share some market context on the New Zealand market. The intermediated market makes up about half of the overall insurance market in New Zealand. Around 80% of our GWP is spread across 5 key broker partners comprised of 3 global and 2 local networks. It's a diversified broker partner mix, which reduces our concentration risk. And our broker NPS scores consistently outrank competitors across various surveys. What differentiates our business is our scale and our local capability. We have deep on-the-ground broker and customer relationships, strong local underwriting expertise and a leading claims capability. Together, they enable faster decisions and better outcomes at the moments that matter most. We've also evolved the proposition beyond traditional insurance with our risk solutions, strengthening risk assurance, prevention and customer engagement. Taken together, these fundamentals give us a strong defensible market position and a platform from which we can continue to invest, modernize and grow with discipline. We're currently well into a soft market and I've seen a few of these during my career just like Jarrod. Heightened levels of offshore capital are driving down commercial rates. Corporate property rates are down 10% to 30% year-over-year and SME, property and commercial motor vehicle are both down about 5% to 10% year-over-year. Our priority is discipline, not chasing volume at any price. The good news is we are seeing -- starting to see signs of potential recovery. Now it's way too early to declare victory but as a market leader, we will lead the market with targeted modest rate increases. The team has been communicating inflationary rate increases are coming and we're working with our brokers to manage expectations. We're also seeing more managing general agencies enter the market. Most MGAs specialize in specific segments, often with a modern tech stack that gives them speed, speed to quote and bind. The potential for AI native brokers would further intensify the competitive landscape. Our strategic response really differs across our key customer segments. In our corporate segment, we remain relationship-led and really disciplined on price. These are the largest businesses in New Zealand and we enjoy strong part type relationships with our brokers and customers where we provide sector-based expertise. The SME mid-market segment is our largest cohort and it's less exposed to the price cycle. The opportunity here is to invest in digital capabilities to lift speed to quote and respond to brokers' needs faster. Migrating on to the Commercial Enterprise Platform is a key strategic priority with planning commencing in FY '27 and commencing in FY '28. In the interim, we'll continue to modernize the business through pricing sophistication, process optimization and targeted use of data and AI. We see the smaller personal rural segment as an opportunity to explore agency models to better serve our brokers and our customers. As an example, we've invested in Ag Guard to target growth in the rural market. Ag Guard launched a digital end-to-end proposition tailored to rural customer needs earlier this year to improve service and increase efficiency. Early feedback is very positive. A recent quote from a broker was super fast and responsive, blowing your competition out of the water. That's the kind of feedback we like to hear. So we'll continue to pursue targeted growth through our agency investments. Similar to retail, we continue to introduce unique propositions to reduce reliance on price-led competition. NZI Risk Solutions enable us to win customers on value even when we're not the cheapest. These services shift insurance from a once-a-year transaction to an ongoing relationship. As an example, our fleet fit retention rates are 95% and generate strong lifetime value. We're amazing when there's a claim. But the best claim is the one that never happens. By identifying and mitigating risk upfront, we reduce both the frequency and severity of claims and that's good for customers and it's also good for us. As an example, in 2,000 electrical inspections, we found over 4,000 serious defects that could have resulted in a serious fire. Actions like these where we reduce preventable loss mean less downtime for our customers and improve relationships that stay in the test of time. This creates a virtuous cycle. Customers and brokers see our value as a partner and we achieve stronger portfolio quality and returns. This is how we balance growth, affordability and profitability through the cycle and why these solutions are a core part of our long-term strategy. NZI is a high-quality business with strong fundamentals. We're the market leader in commercial. We're the leading brand with brokers and we're differentiated through our local claims capability and our unique risk solutions. While we are operating through a soft part of the cycle, we'll lead out of it with discipline. And looking ahead, our strategic investments will modernize the business, including migration to the commercial enterprise platform and some targeted bets in alternative distribution where it makes sense. Together, these actions ensure NZI is well placed to sustain and deepen its leadership as the market evolves. Thank you. And I'd now like to invite my colleagues up on the stage for Q&A and no video this time.

I'm going to say the same again. So Mark is just going to facilitate questions.

Nigel Pittaway from Citi. Just starting off on the comment you just made on AI native brokers could further intensify the competitive landscape. What do you think are the factors that are going to most dictate the prevalence of those native brokers and whether or not they're significant?

To my comment, the factors will be how quickly the AI evolves. It becomes easy for brokers to utilize them to interact with companies and how receptive companies are to interacting with them.

So do you -- I mean, do you think it's likely that they, come 2030, they're going to be very prevalent in the marketplace? And how are you thinking about that?

I wouldn't dare speculate on how prevalent but I'd say we're going to prepare ourselves to deal with brokers. It's a similar answer that we gave to customers is, we want to deal with customers the way they want to come to us. We want to deal with brokers the way they want to interact with us if it makes sense for us from a business.

I mean Nigel. sort of, if there's a sort of a higher order question of -- I mean, Intermediated is a wonderfully entrepreneurial. And we're working on the basis that change is occurring. We're changing our business to meet our customers. No doubt they're doing something very similar. We know that, that advice is sought. Our industry and our products is complicated on one spectrum and hence, we have the advice model and therefore, the broker model why it exists in the first place. We're working on the basis that they're a very relevant part of the insurance industry and therefore, a very, very important part of the way these guys are running their businesses. No doubt, there's a lot of engagement with AI within their businesses and how we're connecting and a lot of efficiency productivity. But just the concept, we're working on the basis that they're a relevant participant in the market.

And just, Nigel, just that in 2030, I'd hate to speculate what the world is going to look like then from an AI perspective. In the engagements I'm having broadly across the broker community, the focus is really much on frictional cost. How do they free up their time? How do they enable their brokers to be spending that quality time with the client to make the real difference and what the client really values.

And maybe just one quick follow-up. I mean just as you said you've been fortuitous in that you've got your sort of modern system in place in retailers before the market changes. Do you have any concerns that given you're still in this transformation process that, that's all going to happen a bit quickly for you given you won't have completed the transformation?

I'm comfortable with where we are on that journey compared to our peers. We're still able to connect. So we have a strong connectivity layer. I think that's the first place things will change. But our delivery time line, so we deliver a lot of our commoditized products, they go straight through as part of the SME, our small business products get delivered through next year. So we'll be moving pretty fast to what could be a fully AI-enabled capability. So I'm comfortable with where we're positioned and probably more so from the product construct that we're building and what that will enable us to do with dynamic product offerings to our broker partners. That's where I think we have a true advantage and that will take some time for others to catch up, I'd say.

Kieren Chidgey, UBS. Jarrod, can you just unpack sort of how you're thinking about the timing of the cost ratio improvements in your business? You're talking about acceleration of the commercial platform. Is that 3% improvement in FY '30 number, when will we start seeing sort of the expense ratio start to fall?

So if I look at our commercial enablement -- sorry, Commercial Enterprise Platform, did I get the acronym right? That -- we complete delivery in '28. So we really start recognizing full value in FY '29. That's when the real marginal gain comes. In the interim, though and we've started at claims because we have a single consistent platform across Guidewire for claims. We will get some efficiencies on our claims handling expenses there, mainly at the front end of the business and what we're seeing there is -- that's our biggest turnover area of our business from a staffing perspective. That's enabling us just to modify the number of new recruits we bring into that space. And we're already starting to recognize some savings there with the ingestion models that we've already deployed. So it will be modest as we deploy and have those deploy cost and then it will accelerate at the back end towards the FY '29 and FY '30s.

And just second question, sort of you started your presentation by articulating your confidence in managing the business through the cycle. In the short term, in the position we're in at the moment in markets, is there a risk margins short term go down before they go back up?

It's a challenging environment. But if I put that in context of our portfolio, we've -- I mean, we've got a global segment, a major account segment that is highly competitive at the moment, heavily influenced by global capacity. That's by far and away the smallest segment of our business, so circa 10%. Middle market, which is, generally define asset somewhere between $20 million and $250 million. That's our rough split, less dynamic in pricing, less international capital flows in there. And we've still got SME, agri, personal lines that we're still getting rate in that business. So the overall balance that we have in our portfolio and separately having our WFI business that's a non-broker business that has a more stable, less impacted from -- we feel that, that balance will enable us to manage through the challenges we see in specific segments. What we will see though is potentially growth will slow and we've already seen that as we have to make decisions to step away from business that we feel is too impactful to margins and we have seen that already through this year.

Siddharth Parameswaran from JPMorgan. Just a question around some of the actions that you've taken before about getting a separate license for intermediated. And just could you talk about what that has done for your business in terms of increasing optionality, what you're actually seeking to do with that optionality?

Yes, sure, Sid. I mean essentially sort of starts with the philosophy which we've reinforced again today around -- we think of ourselves as a retail and intermediated business. You can see that even the way we presented our business, the 2 retail, the 2 intermediated and there's a lot of similarities there, obviously. We had already separated out, not because of the license but because I thought that was the best way to run the company, sort of how we go to market. And so I mean in Australia, Julie and Jarrod, have already separated their team, claims, pricing, that was already in separate teams, not because of the license, Just because we thought that was the best way to run the business. And that sort of had already been replicated in New Zealand. So the license in my mind was really lining up the balance sheet with the business, kind of the story and ensuring that we really were running each of these businesses not separately but really focused on their brands, their customer segments and the balance sheet that supported that part of the business. I think what it also does, a separate license for CGU in Australia, does give us a bit more flexibility on funding on capital structures and the likes that we're not fixated on as a concept but does create some flexibility in our business model going forward. And that's not our main focus actually. Our main focus is at the front of the business. But the way we've set it up -- sorry, last comment, the way we're running technology platforms, when we originally called the technology platform we built for the retail businesses, the enterprise platform because we're going to roll it out everywhere, exactly the same. And we kind of -- we did that with claims but we kind of worked out for sort of policy and sort of the front of the business, we sort of needed -- the uniqueness -- the products are quite different. And I was worried we're going to have a project that was sort of half done everywhere. That was -- and so that's sort of that nightmare but we didn't do that. So in fact, the retail has its -- we now -- you can see our language, we call that the retail enterprise platform that supports the retail business. And Jarrod, we're calling that commercial platform, the commercial -- we're calling that different. Now Guidewire is in both, so it's not completely separate. But we really are running the company like that. I think a license and a separate balance sheet gives us optionality. It's not really in the way we run our company, it's not really driving anything.

We're done.

That's a wrap-up from Mark. Thank you, panel and thanks for the questions. And now we will change lastly to William, who's just going to take us through some of the financials and reinsurance aspects of our business.

Okay. Good afternoon all. Welcome to the last presentation of the afternoon. This is my second Investor Day as IAG's CFO. And building on the progress over the past 2 years, I'll bring together everything that you've heard from Nick, Neil, Jarrod, Julie and Phil into the IAG financial model shown on this slide. Starting with the top line. And based on our operational plans and forecast industry growth in Australia and New Zealand, average annual GWP growth of mid-single digit is clearly achievable. I'll then outline how our reinsurance strategy provides strong downside protection and low volatility. This means IAG can deliver a sustainable reported insurance margin of at least 15% with additional material potential upside. Together, this provides an ROE of greater than 15% and high single-digit EPS growth. Our dividend payout policy of 60% to 80% provides us a sustainable and growing dividend to our shareholders. Additionally, we expect to generate excess returns that can be reinvested back into growth opportunities or used for capital management, typically buybacks, which will continue to reduce our share count. In combination, we believe this positions us well to achieve top quartile total shareholder returns. Firstly, on expenses. We remain focused and on track to our sub-11% admin ratio target and I'll unpack for you some of the moving parts. Like many firms, we face pressures on our cost base, primarily from technology and the investments we're making to support future growth. These will be more than offset by process and efficiency benefits, reducing the proportion of premiums that it takes to maintain and run IAG and allowing us to invest more in growth, transformation and customer initiatives. As you've heard today, the management team has a strong focus on improving efficiency and productivity. For example, Neil detailed our consolidated technology road map and how AI is being employed throughout the organization. Julie talked the digital transformation and how 65% of new business sales are via this channel and it now takes 50% less time to quote home and motor online. Jarrod described how accelerated Commercial Enterprise Platform and operating model changes are structurally lowering total controllable expenses, thereby improving productivity. And Phil mentioned various benefits of operating on a single platform for the retail business, namely fewer systems to use and products to sell, more automated processes and having blended teams across sales and service functions. These are just a few examples and we've worked hard to entrench an organization-wide focus on granular itemized productivity improvements and we have strong rigor in tracking the financial outcomes, giving confidence in delivering the benefits. Tech and AI are already delivering around $350 million in claims benefits and around $130 million in expense savings towards our efficiency targets. As a result of this, we anticipate maintaining a competitive claims ratio and achieving a reduction in our expense ratio. Specifically, the admin ratio on an ex levies basis improved in 1H '26 to 11.7% and we expect this to reduce to under 11% in FY '27. And within our FY '27 spend, we include a further around $400 million investment in tech and AI as we continue to execute at pace on the exciting opportunities ahead. I'll now discuss our strong capital foundations. Our capital targets are anchored around robust regulatory capital target ranges. We have a resilient capital platform that is diversified by type, duration and provider. As shown on this slide, IAG has been innovative in its use of reinsurance to reduce earnings volatility and capital requirements over time. This low volatility capital-light strategy has allowed us to invest in the business, make acquisitions without the need to raise equity and return surplus capital to shareholders via on-market buybacks. Since FY '14, the ratio of GWP to prescribed capital has improved from around $3 per $1 of capital in FY '14 to approximately $6 now. While part of this trend can be attributed to capital allocation initiatives, this has also been driven by IAG's innovative reinsurance arrangements. The original Whole of Account Quota Share deals provided the foundation and this was further extended by the long-term perils volatility and adverse development covers. On this slide, I've shown the schematic, which outlines the 3 core components of our overall reinsurance strategy. The 35% quota share arrangements, the main catastrophe protection and volatility cover, all serve different purposes. And I'll talk to the specifics of each in more detail over the next few slides. The combination of all of these protections lowers earnings volatility, provides balance sheet protection and materially reduces our exposure to natural perils. Firstly, on the Whole of Account Quota Shares. These are diversified by counterparty and maturity. Since 2015, when IAG first announced the 20% deal, they've increased in quantum to now result in 35% of our consolidated business being ceded to our reinsurance partners. Following the recent acquisition of RACQ Insurance, we've integrated it into our reinsurance program by canceling its previous quota share arrangements and replacing it with a 2.5% share in IAG on similar terms to our existing arrangements. This has already contributed the bulk of the run rate synergies of over $50 million that we identified at the time of the acquisition. Cumulatively, these quota share deals have reduced our regulatory capital requirements by over $1 billion and provide approximately a 5-point uplift to our insurance margin from a combination of fixed and profit commissions and savings on other reinsurance costs. Secondly, in relation to our main catastrophe protection, this cover is renewed annually on the 1st of January and it provides significant balance sheet protection for gross perils costs up to $10 billion. It has one full reinstatement purchase, which is a unique feature of the local market. This cover addresses the significant regulatory requirements that we face, particularly in New Zealand, which requires cover for a 1 in 1,000-year event, which is among the most conservative in the world. We also adopt a panel of partners for this protection and it includes both annual and multiyear capacity. Additionally, it has been placed on favorable terms given that we don't need to place the full cover. As a result of our quota shares, we only need to place 65% of the capacity on this program. Importantly, the counterparty credit rating is also very strong with over 90% being rated A+ or higher. The final component of our reinsurance program is the perils volatility cover. This pioneering protection recognizes the potential for perils to impact the financial stability of Australian and New Zealand insurance companies. This is a long-term deal that provides significant downside protection. And in future years, the annual attachment only increases relative to underlying aggregate exposure. I also want to highlight that as the cover was not utilized in FY '25, the $1 billion of protection or $680 million on a net basis is available now and every year for the remainder of the arrangement through to June '29. And with pricing fixed over the term of the arrangement, this effectively gives us flexibility in how the impact of perils' assumptions and reinsurance costs are reflected in customer premiums. There's a profit commission component that's built into the economics of the transaction. And given that this is modeled over 5 years under the IFRS GMM approach, it's relatively stable and is not materially impacted by perils' activity in any discrete financial period. At the time of the announcement of this cover in conjunction with the adverse development cover, we indicated the incremental cost of the downside protection was around 50 to 100 basis points of the group insurance margin. And this is included in the margin targets that we're discussing today. In the slide on the right, I have also provided further detail on the long-term perils volatility cover and its impact on our peril modeling. The significant downside protection that I referred to earlier means our peril costs are capped at our allowance in around 95% of scenarios. In 40% of scenarios, from the peril allowance up to the $1 billion limit each year of the cover, we covered in full, meaning our reported results will be in line with our peril allowance. In approximately 55% of outcomes, the peril outcome is below allowance and so we will retain the favorable perils upside in our earnings. And finally, most importantly, the lower chart shows the mean of these expected net peril outcomes. So the favorable upside skew gives an average benefit through time of over $100 million insurance profit in the margin and this is an average potential upside of over 1 point per year of margin, which is a key component of our longer-term financial model. So bringing all of this together to help you understand the various impacts on IAG's reported margin, I've included the key components on this slide. Firstly, as we've indicated, our underlying margin target is around 15%. And in any financial period, that could be impacted by a range of factors, including the commercial rate cycle, competition, claims frequency and inflation and investment market volatility. On top of this, we expect reinsurance profit commission on our Whole of Account Quota Shares. That has been an increasing feature of our results and we've been risk-adjusting recognition of this additional upside. As the arrangements come closer to their maturity dates, recognition is expected to increase. Going forward, it's reasonable to expect at least 100 basis points in profit commission and this could potentially increase to 200 basis points. And finally, as discussed in the previous slide, we have average perils upside of approximately 100 basis points a year. We note there is variability from year-to-year in this number. So we'll continue to build our guidance on our stated perils allowance. So the upside won't be built into margin guidance but still, we think it's an important feature for the market to understand. So putting this all together, we expect to deliver a reported margin through the cycle of at least 15% with average potential upside of 1 to 2 points per year. And obviously, this upside provides us with optionality to reinvest for growth. And for comparison, I'll remind you that our reported margin at the recent half year was 17.7%, excluding the one-off RACQ impact. And in FY '25, which, of course, was a favorable perils year, our reported insurance margin then was 17.5%. So these margin settings drive our greater than 15% ROE and high single-digit EPS growth that set us up to deliver top quartile shareholder returns for you. And with that, I'll ask Nick to join me on stage for the next and final Q&A session.

Andrew from Macquarie. Couple of questions, if I can. Let's start, William, with that last slide. If -- there are very few realistic scenarios that are going to get you below 15% reported insurance margin and you're adding on an additional 100 to 200 basis points of benefit from the profit share, from the quota share, why don't you just step the guidance up, like I don't understand.

Okay. Thanks, Andrew. I'd say 2 things. One is, of course, the underlying margin, depending on the period and those things I mentioned, whether it's commercial cycle, competition, claims frequency, inflation, investments, that could be in different points in that 14% to 16% range is what we expect the underlying margin to be. Then you have the -- on top of that, of course, the profit commissions, 1 to 2 points. But you can see the range is 15% up. And what we don't want to do is build in the perils into -- the perils upside potential into -- because you don't know in which year that's going to come. We had it in '25. It doesn't look like we're getting it in '26. So over time, that's definitely upside but we're not going to build that extra component into the growth.

I think why aren't we saying it's 15% plus and the perils allowance we've got is very strong. So that's -- and then we're sort of saying investors, we're laying it out for you. And we think that 15% plus margin ROE high single-digit EPS growth. That's sort of the expectation as an investor with some upside the way William has sort of set it out.

And then the other one I had was a couple of your global peers have started to take net provisions for Greensill. There's discussions going on through the court process at the moment. Where are you in that process? And could you potentially take a net provision for that in FY '26?

Yes, there's no change to what we -- we went into a lot of trouble to disclose that and we've sort of adjusted that a little bit over the last couple of years. So what we said in February is still the same, so the net position of IAG. There's a court date scheduled for later in the year. There's a requirement to go through a process of mediation that's sort of not about someone blinking. It's about a formal process that one needs to go through. That's sort of occurring at the moment and sort of our net position is unchanged from the disclosure we provided. [indiscernible] even stronger. The fact pack of what we disclosed that is the fact pack today.

Kieren Chidgey, UBS Couple of questions. William, if I can just start on the reinsurance quota share profit commission, the range of 100 to 200 basis points. If we see outcomes in line with cat budget, do you land at the top end of that range?

So the -- and there's a perils component in there as well. Obviously, our core budget, our core underlying earnings and in fact, even the perils part in our reported margin is so strongly protected, as we've described by the perils volatility cover. But in looking at the profit commission, those -- some of those things can come in. So it will sort of depend also what's happening with perils.

I'm not particularly clear on what that response was. I guess the question is a fairly simple one. If we see outcomes in line with cat budget sort of over the next few years, will we see 200 points of benefit from quota share profit commission?

Yes, you'd be close -- you'd be around that, yes. However, again, the other thing I mentioned was that the -- because we risk adjust it, we're not going to -- the amount of that will tend to grow as we get closer to the maturity dates of the different...

Of the quota share?

And I'd like to add one other thing. And obviously, the quota share profit share commission is the whole of the business, not just on the perils outcome. So therefore, that's also with the assumption that the underlying business is delivering a good change.

Yes, yes, yes. And similarly on the aggregate, if we see cat budget outcomes, where would the contribution of that profit commission go? I know it sits within the 14% to 16%. But is that -- I think you've been booking at about $80 million per annum. Does that go up from what we've seen recently?

Yes. I don't think we've disclosed precisely $80 million but I think that's been reverse engineered from some of our things we have shown. But no, that -- I mean, that number -- that cover, the -- as you know, the premium and the other features that cover are relatively stable through time. So you shouldn't expect that to change very much.

Okay. And final question, just the maths behind sort of getting from 5% GWP growth to high single-digit EPS growth, is that dependent on landing above 15% and having that buffer to recycle into capital management? Or if you're at 15% margin, can you still deliver high single-digit EPS growth?

Yes, we believe we can do that if we're at 15% margin. So we have, of course, our 60% to 80% dividend payout. We'd expect to invest a little bit of that in growth and capital requirements supporting growth. But over time, we expect that also support some additional level of capital management, typically buybacks. And if we deliver above, then we can either accelerate or we've got more capacity to reinvest further in growth.

And remembering our dividend policy is not on underlying. Our dividend policy is on just how much money we make. So there's a range there from 60% to 80%. But if we have a couple of good years from perils or that -- an element of that just immediately goes into the dividend policy. And sure, we got some -- we have a range in there to potentially go to the bottom and do more buybacks or something like that. But don't forget the dividend policy is on absolute earnings, not on underlying.

Richard Amland, CLSA. Now that we've heard from all the business units, I'd like to go back to the 6% GWP and sort of see if I can get some relativities between the business units. I'm not necessarily convinced that you can keep growing home at 9% to 10% per annum but you can offset that with recovery or acceleration in intermediated. So can you -- within the 6%, can you just talk to -- and you don't have to give percentages, if you're uncomfortable but just sort of how that stacks up between the home, motor, intermediated Australia, intermediated New Zealand.

Yes. I mean the themes are going to be, aren't they? In the next 1 year or 2, intermediated, it's going to be tough as sort of it's coming through a softer cycle. Now one assumes that changes. So we know the history of that business is, that does change. And so we would be assuming that, yes, the next 1 to 2 years, that would be low to sort of single-digit type growth. But we've got some change happening in New Zealand. And we know that our business -- our commercial business, intermediate business in Australia has got many attributes that aren't big in the town. So that's helpful. On the other side of that, I think on motor, we're definitely not seeing -- seeing a reduction in some of those inflationary pressures, sort of from a 12-month view. Sure the Middle East at the moment may cause some increase in parts but I think that's definitely has come down quite a lot. I think the challenge is around property actually, where it feels like that's inflation, which has been sticky and just hasn't gone away, pre-Middle East was still there, building costs and sort of claims, the cost of rebuilds for us. But I think it's not unique to the insurance industry, just the housing markets. And I think the Middle East is going to make that go longer, that inflationary pressure. And so I really see inflation in our home and therefore, pricing stronger for longer, if that's the right expression. And I see the question of affordability. I mean that's a challenge but that's what we're experiencing, that inflationary pressure and that's just not -- it's not coming off on property classes.

How much attritionally [indiscernible] you can raise prices but I think you lose customers and...

Yes. I mean not much is the answer to that, at the moment. I mean we're not saying that. That's not our lived experience of sort of people effectively opting out. We see a little bit of examples in motor and second and third cars and people dropping out their covers and -- but not less so in property. Content maybe versus -- comprehensive versus the home. Sorry.

Just a point of clarification. What sort of investment yields are you assuming to -- in that 15% margin?

So the investment yield, I think we're -- I think at the moment, it's -- we're assuming somewhere between 5% and 5.5%.

Just maybe -- Nigel Pittaway, Citi here again. Just maybe a quick clarification on New Zealand. I mean, previously, you've said that obviously, New Zealand is over earning, you expect it to come back. So presumably within this target, we're expecting New Zealand to be a little bit above the 15%. And how soon do you think it's going to get there?

I mean it's probably the same question we asked Jarrod to about how soon are you going to get there? Because I think the theme for us, Nigel, in the way we've thought about all this is, we've got a retail business that's delivering at 15%, maybe a little bit above. We've got our commercial intermediated business in Australia, sort of run rate sort of 11%, 12%, that's drifting up. over the next couple of years. And then you've got to proportionalize these, the numbers here versus the size of the businesses. And then New Zealand, definitely not dramatic but definitely, we're expecting that to come back a bit. And the theme of sort of that, the package of that comes back to this. You can see the makeup is a little bit different.

And just on conditions there at the moment, are they -- I don't know whether you can say anything about actual conditions there today but just in New Zealand, does -- has it come back as quickly as you thought or is that [indiscernible]

In margin? I mean, no, no. I mean we've been very disciplined in -- I mean, on retail, it sort of pretty much the same. On commercial is where we're really seeing quite a change in the pricing environment in the last 12 to 24 months. We've been very disciplined but that's impacted growth. And so margins are still okay. But I do expect them over the next couple of years to drift down.

Last call for questions. It looks like we might have answered all of the sell-side questions today. That's a first. We'll take that as a win. We're done.

That's a wrap-up. Okay. Thanks, everyone, for coming along today. I mean the things we want to leave you with and this is a very quick wrap up, everyone, because I know you've been sitting here for a long time. We feel like we're in really good shape at IAG. We've done a lot of heavy lifting to get the business where we want to be. We are rightly focused on sort of Ambition '30 around sort of the core planks of us around customer, around this sort of insurance excellence we're phrasing. We're really good at running an insurance company. About the running of our operations, you hear a load about that. And there really is change -- more change happening. And then, of course, the people that are going to drive that and sort of the culture and us and the capability that we've got within the company. Outcomes, I mean -- we're trying to be quite specific on the outcomes we're delivering in Ambition 2030. That's really around the size of the company, $25 billion plus, the sort of profitability margins of 15% plus insurance margin, 15% plus ROE and really this high single-digit EPS and sort of growing dividend return to shareholders. And we want to leave that with you as the outcomes we're going to deliver over the next 4 years. All right. Thank you online -- those people online, thanks for staying with us over the last couple of hours. Those in the room, thanks for those that came out and saw our sites. Our people are really proud to show off what we got. You probably saw a fair bit of that when you were there. And we invite you to refreshments in the room here on Sussex Street. Thanks again, everyone.