IAG expects to cash in on the global credit crunch as consumers turn to brands they trust, but admits economic conditions are not ideal for the planned sell-off of its UK operations.

Speaking at a Trans-Tasman Business Circle lunch last week, IAG CEO Mike Wilkins said consumers are engaging in a “flight to quality” – a trend that stands IAG in good stead.

But that might not help the group’s under-performing UK assets, although Mr Wilkins says there are some potential buyers. An IAG spokesman told insuranceNEWS.com.au it’s “obvious” that same market volatility won’t help it find potential buyers of Hastings/Advantage and Equity Insurance brokers, as well as the Alba and Diagonal investments. But it’s all about the right price, with Mr Wilkins telling the business lunch IAG is “a realistic vendor”.

UK analysts say the motor insurance market into which the IAG businesses are being pitched is extremely competitive at present.

Overall, Mr Wilkins says the company is on track with the corporate restructure he set in train in April.

The group maintains it will achieve its projected insurance margin of at least 10% for the present financial year and has forecast gross written premium growth of up to 2%.

Mr Wilkins is also relaxed about talking to QBE CEO Frank O’Halloran in the (doubtful) possibility he might have revised his May bid for IAG upwards.

“I’ve known Frank for a long time,” he said. “I’d listen to what he has to say and then we’d decide after that.”