IAG says it is on track to deliver its full-year guidance of 9-11% gross written premium growth and an improved insurance margin of 11-13%.

Shareholders at the group’s AGM in Sydney last week were told a strong performance this quarter has built on the momentum of last financial year.

Chairman Brian Schwartz says IAG’s results in the year to June 30 were in line with guidance set at the start of the period. Gross written premium grew 11.7% to almost $9 billion and net profit after tax was $207 million.

Operational performance improved in Asia and the New Zealand business returned to profit after the earthquakes, he says. But residential quake claims are progressing slower than the company would like because of government work on land zoning.

The UK business almost broke even, recording a $15 million loss before tax. A decision on a possible sale is expected by the end of the calendar year.

“As you can see, all businesses are delivering on strategy,” he said. “The market is recognising this, with our share price up over 45% since our last AGM and total shareholder return of over 50%, compared with a market average of less than 12% over the same period.”

Mr Schwartz says the strong results are also reflected in the company’s capital position – which was 1.74 times the Australian Prudential Regulation Authority’s minimum requirement at June 30 – and cash earnings, which grew 17.5% to $583 million.

Because of the company’s improved performance, executive remuneration is higher on average than last year, he says. However, “we are extremely mindful of the need to ensure our remuneration framework is in step with shareholder and community expectations”.

The meeting voted in favour of issuing share rights to CEO Mike Wilkins under the company’s short-term and long-term incentive plans.

Mr Wilkins told shareholders Australian direct insurance grew 10.5% in most product classes, because of online improvements and the “Experience the Difference” campaign. He expects a similar margin next year.

Australian intermediated insurance maintained its improved performance thanks to underwriting discipline and cost efficiencies, he says.

On the subject of flood pricing, Mr Wilkins says 2% of Australian households are subject to some element of flooding, while 0.5% are subject to chronic flooding.

He says including flood cover as standard has had a negligible impact on premiums but where more detailed data or maps are available, there has been a “significant increase” for some customers.

Calling again for more government spending on mitigation, he said building on a flood plain “is not an unexpected loss”.

On the question of writedowns in IAG’s UK business and the lessons for the group’s Asian expansion, Mr Schwartz says it seeks to learn from past mistakes. He says IAG needs its own people in key positions in its carefully chosen Asian partner companies.