IAG has granted embattled CEO Michael Hawker a package of almost half a million share rights worth $2.2 million as he fights to turn the insurer's fortunes around.

Mr Hawker has received 350,000 executive performance rights (EPRs) and 144,500 deferred award rights (DARs) over the past month.

The EPRs can be redeemed after three years with no exercise price, subject to a number of performance-related targets, while the DARs can be triggered progressively over the next three years, with a nominal $1 exercise price: 50% in the first year, 30% the following year, and the final 20% in the third year.

IAG has effectively raised the bar with EPRs, which incorporate two separate performance hurdles around both total shareholder return and normalised return on equity. The previous system of performance award rights (PARs) only measured performance based on total shareholder return.

But Mr Hawker's DARs are not linked to performance. At yesterday's closing price of $4.45, the total new package would be worth just over $2.2 million.

A company spokesman told Sunrise Exchange News it's a "strong incentive" for Mr Hawker to grow IAG's share price.

IAG has also implemented a policy requiring the CEO to maintain a minimum shareholding in the company with a value at least twice his base salary. Mr Hawker's base salary for last year was $1.3 million.

He now holds the rights to more than 2.5 million shares in the form of PARs, EPRs and DARs. The redemption value of the whole package at today's share price would be worth $11.1 million.

Last week IAG issued an earnings downgrade, reducing its gross written premium growth forecast to 7-9% from 10-12%.

But shareholders at today's AGM won't get the chance to vote on the share package, as the plan involves rights over issued shares and therefore has no effect on shareholders, in line with ASX listing rules.