IAG could have acted earlier after realising add-on cover sold by its Swann subsidiary was not meeting the needs of customers, Chairman Elizabeth Bryan said today.

The company was grilled during the Hayne royal commission insurance round of hearings last month about the often-worthless products distributed through motor dealerships.

Ms Bryan told the company’s AGM in Sydney today that while the royal commission has some time to run, “it is already clear that many of the issues highlighted so far are the result of a failure to consider the best outcomes for customers”.

“In our own backyard this certainly was the case with the add-on insurance sold by Swann through car yards.”

IAG decided two years ago that the products were not delivering the value expected by customers and sold its Swann Insurance motor vehicle distribution rights in August 2016. It ended sales through motorcycle dealers last October.

“In hindsight we could have acted earlier,” Ms Bryan said.

She says IAG views the royal commission as an opportunity to deepen its understanding of its customers and communities so it can improve the value of its offering and strengthen trust.

The group will “hold up a mirror” to itself. “From the moment the royal commission was announced we adopted an approach that would maximise our learnings from the process.”

CEO Peter Harmer told the AGM that IAG’s climate action plan has been strengthened by assigning direct accountability to senior executives and identifying key milestones for the next three financial years.

“We have set ourselves an ambition to be a regional leader in tackling this hugely important socio-economic challenge,” he said.

Projects under the revised action plan include introducing a pilot to lower Australian vehicle fleet emissions, implementing a property consolidation strategy to support reduced emissions, and engaging with local government in New Zealand on climate adaptation for the community.

Mr Harmer, whose first days as CEO in 2015 were spent dealing with investors’ resistance to a planned move into the Chinese insurance market, also told the AGM the group is continuing to assess its remaining Asian interests in Malaysia and India. The sale of the group’s Thai operations was completed in late August.

“We do not envisage further material investment in the region,” he said.

IAG maintained an outlook for premium growth of 2-4% this financial year and a reported insurance margin of 16-18%.