STRATEGY
A. STRATEGIC PRIORITIES
IAG’s strategic priorities are to:
I. Maintain its market leading position in personal and commercial insurance in Australia and New Zealand
IAG is the market leader in personal and commercial insurance in Australia and New Zealand, following the acquisition of the former
Wesfarmers business. IAG is focused on embedding and sustaining this position, while maintaining underwriting discipline.
Increased efficiency is being realised via the new operating model in Australia and through the integration of the former Wesfarmers
business. This includes the delivery of Enterprise Operations’ operating efficiency programmes and the consolidation of IAG’s IT
platforms and processes.
The new operating model allows IAG to better leverage its scale and market leadership position to deliver great experiences for
customers and shared value for its partners, people, communities and shareholders.
II. Grow Asian footprint and its earnings contribution
The development of IAG’s business in Asia is progressing to plan, and it is now in the phase of accelerating operational development
and enhancing risk management and governance. IAG has increased its capability in the region to ensure the potential of the broader
Asian platform is realised over the medium to longer term.
Expansion of IAG’s Asian footprint will result in a higher proportion of GWP coming from this region in the future, and more capital
being invested in higher growth insurance markets.
It will support IAG’s vision of being Asia Pacific’s most loved, most inventive and most successful insurer.
III. Accelerate digital transformation
The exponential adoption of new technology is rapidly changing customer and competitor behaviour and creating risks of disruption to
the insurance industry. It is also creating new growth opportunities for companies that embrace the changes to explore new ways to
meet emerging customer needs. IAG has established a new division, IAG Labs, to take advantage of digital opportunities and enable
the Group to become more innovative.
IAG Labs will help the organisation deliver great customer experiences by building the capacity and capability to rapidly develop and
test new customer product and service ideas. IAG Labs incorporates the Group’s core IT functions and is accountable for delivering in-
flight strategic IT investments.
Bringing together IAG’s existing technology, digital and venturing teams with its customer insights and analytics teams allows IAG to
better understand customer needs, deliver great customer outcomes and to innovate at scale. IAG Labs will create new ways of
working and drive significant cultural change, resulting in a more dynamic and innovative environment.
IV. Create deeper customer insights and an agile response
Customer needs and behaviours continue to evolve rapidly alongside changes in technology, creating a myriad of new opportunities for
customers to interact with IAG.
IAG is investing in programmes to drive stronger customer-centricity, including research on customer insights, the development of
customer journey maps, and the deployment of human centred design to improve customer and partner experience. IAG is investing in
its data and analytics capability to deepen its understanding of customers and their assets, to simplify customer engagement
processes and to drive customer value by better understanding risk patterns and helping customers minimise the cost of managing
risk. This helps IAG strengthen its market leadership position by delivering superior value to customers.
The new operating model and the establishment of IAG Labs are important initiatives in supporting customer insights, designing better
customer experiences and building a more agile organisation.
B. BUSINESS RISK AND RISK MANAGEMENT
Managing risk is central to the sustainability of IAG's business, its purpose and delivery of value to shareholders. IAG uses an
enterprise approach to risk and its risk management framework is a core part of the governance structure and includes internal
policies, key management processes and culture. The Risk Management Strategy (RMS) is reviewed annually or as required by the
Risk Committee (RC) before being recommended for approval by the Board. IAG’s risk and governance function provides regular
reports to the RC on the operation of IAG’s risk management framework, the status of key risks, risk and compliance incidents and risk
framework changes. IAG’s Internal Audit function provides reports to the Audit Committee (AC) on significant audit findings and other
audit related matters.
Roles and responsibilities of the Board and its standing committees, the AC, the RC, the People and Remuneration Committee (PARC)
and the Nominations Committee, are set out in the Corporate Governance section of the IAG website.
12 IAG ANNUAL REPORT 2015
