Insurance Australia Group (IAG) is holding discussions with Victoria’s RACV about the future of its joint venture business, Insurance Manufacturers of Australia (IMA).

Yesterday The Australian Financial Review reported IAG, which owns 70% of IMA, wants to buy out RACV’s 30% stake in the insurance product manufacturing business.

But it is believed that the discussions aren’t entirely going the way IAG would like. While the initial talks between the groups were unsuccessful, the newspaper said both parties agreed to “share a common vision” for growing IMA.

IMA prices, develops and manages personal lines classes of business – which are sold under the RACV brand in Victoria and NRMA in NSW and ACT.

IAG currently derives about 30% of its premium revenue from the JV – which earned more than $316 million in the 2005 financial year – but it would like a bigger slice of the cake.

IAG declined to comment on the speculation.