IAG plans to cut annual operating costs by about $250 million over the next three years as it simplifies operations.

The group will partner with global insurance and business process experts to cut complexity, simplify procurement and reduce core claims and policy administration systems to two platforms from 32.

CEO Peter Harmer says the changes are part of a strategy over 3-5 years, with the themes of leading and fuelling.

“Fuelling means making the necessary changes to the way we operate – simplifying processes and systems and optimising resources to be more efficient so we can invest in leading.”

The program aims to reduce gross operating costs by at least 10%, equating to $250 million pre-tax, by the end of 2018/19, IAG told an investor briefing in Sydney last week.

IAG will also establish a $75 million ventures fund next month to invest in new businesses that focus on customer understanding, value chain disruption and new pathways to market.

COO Mark Milliner says overall there will be fewer people at IAG, but he declined to detail likely job losses.

“I don’t think we know any specific numbers yet in that sense,” he said. “There’ll be programs of work that it will come from – automation, robotics, better systems that we’ve got in terms of transaction systems – that will all make it an easier and more efficient organisation.”

The insurer says its strategy includes driving Australia and New Zealand business growth in line with a market expansion of 3-5%, and higher growth from chosen Asian markets.

“IAG will continue to review the mix of its capital platform, with potentially greater use of reinsurance capital and lower reliance on equity,” it says.

This financial year the company expects gross written premium growth will be relatively flat, with modest rate-driven growth in short-tail personal lines in Australia and New Zealand. The commercial market in Australia is showing “further encouraging signs” of improvement.

IAG expects a net claim cost of about $200 million from the recent trans-Tasman storm and New Zealand earthquake.

The company has maintained its reported margin guidance of 12.5-14.5%.