IAG is pushing through rate increases across its motor and home lines, in some instances by up to 11%, giving the insurer confidence that it has a “good handle” on mitigating the inflation challenge that is affecting the Australian and global economy.

Its Intermediated Insurance Australia (IIA) business has also established an inflation taskforce within its pricing division to help the commercial-focused unit manage the challenge, the insurer told a post-earnings webcast with analysts on Friday.

Group Executive Direct Insurance Julie Batch says the business is now pushing through motor rate rises of 7-9% and in some states up to 11%, while the home portfolio is seeing adjustments of 8-10%.

“And we’re very confident that that is sufficient for us to cover right now ... the inflation that we're experiencing and those increased costs,” Ms Batch said. “And the most important thing for us is to be able to earn that through quickly.

“So we’re very confident and comfortable that we’re earning through appropriately to be able to achieve the performance that we’ve said. We're very much around growth that is profitable.”

CEO Nick Hawkins says while IAG is “experiencing inflation” throughout the business, the insurer is “managing and [is] on top of that”.

“We're sort of seeing inflation flow through our company at that sort of mid to high single digits everywhere, you know, in various forms,” Mr Hawkins said.

“The flip of that is we're also seeing rates flow through the portfolios.

“We’ve got a good handle on it. We’re repricing… there might be some small timing differences but I think we can manage that.”

Last Friday the insurer provided more details of its results for the 2021/22 financial year, after releasing preliminary figures last month.

The insurer achieved a net profit of $347 million, recovering from a year-earlier loss of $427 million, and gross written premium (GWP) grew 5.7% to $13.3 billion, in line with the numbers flagged in last month’s initial release.

Cash earnings dropped 71.5% to $213 million and the insurance profit declined 41.8% to $586 million but Mr Hawkins says the business is experiencing “really positive underlying momentum” despite the weaker numbers.

“Our FY22 financial results reflect the quality of our underlying business as we build a stronger and more resilient IAG,” Mr Hawkins said. “We had strong GWP growth, and the performance of our business was steady despite the challenging external environment.”