The worst may be over for IAG, with CEO Mike Wilkins saying the business is continuing to improve, posting a $181 million net profit for 2008/09.

Speaking to shareholders at the group’s AGM in Sydney last week, Mr Wilkins said if operating conditions experienced in the first quarter continue the group expects an insurance margin at the upper end of its 9-11% guidance for the 2010 financial year.

“This remains subject to our normal caveats around natural perils and investment markets,” he said. “We also expect to achieve our previous guidance of underlying gross written premium (GWP) growth in the range of 3-5%.”

But he is cautious about the rising value of the Australian dollar, which he says could affect IAG’s GWP.

The group reported a full-year loss of $261 million for the 2007/08 financial year, slumping $813 million on the previous year’s $552 million profit.

Chairman James Strong told the meeting Mr Wilkins has made “significant progress” over the past year. The board “intends to maintain the strategy which is producing improved results for the group”.