IAG has increased the default excess level on some insurance products across its NRMA, SGIO and SGIC brands as consumers look at taking on more risk to minimise price increases.

The insurer says pricing recently has been driven by the higher inflationary environment impacting costs, severe weather and natural peril claims and reinsurance expenses.

IAG says it encourages customers to review their excess as an option to reduce the impact of higher inflation on premiums, and it has seen customers choosing to make changes.

“We have also been assessing our excesses across our products and do this regularly to ensure they remain in line with customer needs,” a spokesperson told insuranceNEWS.com.au.

“For some products across our brands, NRMA Insurance, SGIO, SGIC, we’ve adjusted the default excess for new policies. Customers are still able to increase or decrease the excess on their policy to suit their needs.”

The Australian Financial Review reported today that JP Morgan pricing survey findings include that IAG has adjusted default deductibles for home building insurance.

NRMA Insurance’s home building default excess lifted from $750 in April to $1000 in July, and the equivalent for cover written under the RACV brand rose from $500 to $1000, the article said.

The JP Morgan survey examines 13,000 types of home cover for new customers across a number of insurers. The headline average premium increase nationally for home and contents was 4.5%, comparing July to April.

Suncorp was the only insurer to lower rates, by almost 0.3%, the article says, while IAG, after adjusting for excess changes, effectively lifted rates 5%. The survey found rate increases were mainly led by Hollard, at 11.2% and Allianz, at 8.2%, the newspaper says.